How do I know if my financial plan is any good?

  • If a financial plan doesn't make sense, don't proceed.
  • Any decisions are ultimately yours.
  • Make sure you understand the risk associated with the recommendations.

A financial plan should be easy to understand, clearly explaining how the recommendations meet your goals, and why any recommendations are suitable.

how do i know if my financial plan is any good

How do you check whether the financial plan is any good? Remember, personal advice does not need to be ideal, perfect or the best, but it must satisfy each of the following conditions to be considered suitable:

  • As per the language of the relevant legislation, a financial adviser must make "reasonable inquiries" about your relevant personal circumstances.
  • The financial adviser must give such consideration to, and conduct such investigation of, the subject matter of the advice as is reasonable in all the circumstances.
  • The advice must be "appropriate" for you only.
  • The financial adviser has put your interests ahead of their own.

A good financial adviser should take into account your experience, language skills, literacy and numeracy levels when preparing your advice. A financial plan that does not use language you understand or is heavy with industry jargon, or contains irrelevant information cannot be effective.


Kim went to see an adviser about her superannuation fund. The financial plan included information and an investment recommendation on managed funds. The adviser did not listen or take Kim's objectives into account.

Kim chose to not proceed with this advice and sought the help of another adviser.

Did the adviser explain the risks of the advice?

It can be very easy to be swayed by an adviser's demeanour. Focus on the reason you are seeking advice and make sure it's appropriate for you.


Keep a clear head and take time out for the dust to settle before making major investment decisions.

"Quality" of advice is subjective, but ...

While "quality" is open to interpretation and specific to a person's circumstances, here are some useful questions to determine if a financial plan is good quality and fits the bill:

  • Was it based on a one-size-fits-all model or was it tailored to you?
  • Was it based around the adviser's potential revenue or what was best for you, the client?
  • If another adviser examined your statement of advice (SOA) and the advice provided, would they conclude that it was in your best interests?

Controlling emotions and biases

Many investors make wealth management decisions based on emotion, usually:

  • greed (i.e. wanting very high returns), or
  • fear (i.e. being afraid to wear losses).

Be wary of how these can cloud your investment decisions.

 Why you need a financial advice review
 The financial services laws you should know