If you’ve never met a financial adviser before, it can be a little intimidating to think about what might happen. In this series, our financial adviser Jordan Vaka wants to unpack how he works, in the hopes that it helps you feel a bit more comfortable getting started.
So, you have questions about your money, your investments, insurance, superannuation, budget or just your general financial direction. Maybe you’re starting to plan for retirement, or just want some answers to help you work out what to do next.
Well, speaking with a financial adviser could be your next move. Our role is work with you to articulate your financial questions and concerns, then bring our training and experience to the project of answering them for you.
But we have one big, unspoken question hanging over this idea – how, on Earth, do you choose a financial adviser?
Dodging Bad Apples
Sadly, I think a lot of people avoid getting financial advice because they’re scared of being ripped off by a bad apple financial adviser (like they see in the news).
And it doesn’t matter how many times we talk about the miniscule minority of advisers that fit this category. Or the readiness of the many regulators involved to pursue them. Or that the average adviser is, generally, an upstanding professional dedicated to helping their clients navigate their financial lives.
None of this matters.
Especially when we have another set of stories about the power of self-interest to poison the well. I mean, when I read this story, I feel sick to my stomach. No wonder it’s so hard for people to trust financial advisers.
It’s very hard to persuade somebody you’re not one of the bad apples – after all, a good rule for life is to never trust anybody that says ‘trust me’.
However, the reality is that all financial advisers are now operating under a very strict, broad and comprehensive set of rules, obligations and requirements designed to protect consumers from these rotten apples.
To be blunt – there are easier ways to rip people off now than being a financial adviser (see: crypto spruiking…) so the charlatans only out for themselves have moved on.
Even saying that, we still don’t have an answer to our tricky question – how do you choose a financial adviser?
Here’s One Way
I don’t have any simple answers on this, I’m afraid. I mean, the glib answer is ‘work with me!’, but that’s pointless.
Instead, here are five steps that you might like to take when you’re looking for an adviser:
1) Ask people you trust who they’re using.
3 names is a good sized list, but be conscious that the person you’re asking might have very different circumstances to you.
2) Google them.
Most advisers have an online presence now, and you can also check the advisers register with ASIC. You can also search for any disciplinary action by the FPA, if they’re members.
Have a look at their social media channels. Some advisers are active on LinkedIn, so look into their activity over there – the history of what we’ve done on that channel can be a nice guide to the kind of person you’re dealing with.
3) Book a meeting.
Face to face is best, I find, but COVID might get in the way. And feel free to invite a friend along. It can be intimidating meeting someone for the first time, and most advisers won’t mind – they might even encourage it.
4) Ask questions.
Tell me about your experience as an adviser. How do you help people like me? How are you paid?
You’re looking for somebody to help answer serious questions about an important part of your life. They need to be somebody you can trust and that you feel comfortable ‘pushing back’ when you’re unsure about something.
It could be a long-term relationship, or just having somebody help you get everything sorted out now. Either way, you need to be comfortable, confident and sure of your financial adviser.
5) Commit with somebody you trust.
It can take a while to find someone, but when you find someone you trust, commit to the process – that’s how you get the best results.
This is why it’s so vital that you find somebody you can trust. You need to jump into this process with both feet to get the best results. So if you’re working with someone you’re a bit ‘meh’ about, that’s going to make it a lot tougher to commit.
In the interests of full disclosure, well, here are my answers to the questions in Point 4.
Tell me about your experience as an adviser.
I’ve been an adviser since 2007, after university. I started at a large boutique firm, as an admin assistant, then a big bank and stockbrokers as an adviser.
In 2009, I went out on my own, then in 2018 I merged with a larger firm to form Make a Financial Difference.
In 2020 we decided to change direction and sell MAFD. I received my own AFS License in January 2021 and here we are.
I’ve spent most of my career helping people plan for, and manage their finances in, retirement. But a not-insignificant part of my time has also been spent helping people make better choices for their early financial decision.
How do you help people like me?
We help people through life’s big transitions, especially divorce, retirement and bereavement.
In divorce, we can help before, during and after by:
Helping you identify what you want for your future
Collating information about your current situation
Working with your lawyers around the financial aspects of your settlement
Building you a plan for your future after the settlement.
For the people we help with their retirement, we:
Explore what they want their retirement to look like – do they want to travel, build their dream house, keep working part-time, commit to spoiling the grandkids full-time?
Assemble the various pieces of their financial puzzle together into a coherent strategy to maximise the chance of them living their dream retirement.
Help execute any improvements and changes to better align their finances with what they need.
If they need us to, we can also work with them every year into the future so they can feel confident that they’re staying on track.
How are you paid?
Solely by our clients.
We agree on the scope of our work and the fee for doing so. We ask for a 20% deposit upon engagement, with the balance in monthly instalments over the course of the engagement.
And that’s it. No ongoing fees, absolutely no commissions and no surprises.
We offer people the option of debiting a reasonable portion of our costs from their superannuation, but given how vital it is that people have as much super as they can come retirement, I can see a date when we’ll stop this as well.
Of course, even if these answers sound like a good match for what you’d like out of a financial adviser, there’s no guarantee we’d be a good fit.
So if you’d like to find out if we can help – and if we could be a good fit for working together – please book in your initial call and we can chat about how we might be able to help.