When is it time to see a financial planner?


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Faced with cost of living pressures, plenty of Australians could benefit from expert advice on our finances.

After all, reaching out to a licensed financial planner makes sense if you're keen to put a proactive plan in place for your wealth.

However, David Sharpe, chair of the Financial Advice Association Australia (FAAA), says various life events tend to act as triggers that get us thinking about financial advice. Two such milestones include:

when is it time to see a financial planner

  • Approaching retirement - we may leave speaking to an adviser until retirement is just around the corner, though Sharpe says, "It's best to plan five to 10 years out."
  • Starting a family - there's a lot to plan for when a new baby is on the way, and Sharpe believes seeing a planner can ensure your family "can manage cashflow and is protected in the event of the unexpected." 

Sharpe adds that it may be worth speaking with a financial planner on other occasions, such as:

  • when an elderly parent requires aged care
  • following divorce
  • changing jobs or experiencing a significant pay change (either up or down)
  • if you come into unexpected wealth, be an inheritance or an insurance payout.

It's a broad list, but Sharpe notes, "The data shows the sooner you engage a professional adviser, the better the outcome."

What about advice offered by my super fund?

With many superannuation funds offering free or low cost advice to fund members, is it still worth speaking with a financial planner?

Sharpe believes so.

"A number of super funds employ financial advisers because they understand the difference that professional advice can make for their members," he says.

"Many super funds who don't have internal financial advisers, have agreements to refer their members to professional advisers."

Rather than diluting the need for advice, Sharpe says, that super fund advisers can help identify the need for members to seek professional advice.

Plenty of upsides

Teaming with a financial planner can deliver upsides. According to Sharpe, "People who work with a financial adviser report a better quality of life and more financial confidence and resilience."

He's definitely onto something.

Research in the US shows consumers who partner with financial advisers are more likely to report happiness, confidence, and stability in their financial and personal lives.

And a separate global study found that close to three in five advised clients are highly satisfied with their wealth, compared to two in five unadvised consumers.

It may be the case that money can't buy happiness, but being in control of your money can help.

What about the cost?

While quality financial advice could deliver rewards, the stumbling block can be the cost.

An Adviser Ratings survey found that for 80% of Australians who want financial advice, the price is simply too steep, with the median cost of advice sitting at $3,710. Different advisers charge different fees, so shopping around is one way to save.

Even so, David Sharpe says, "Ultimately, the cost is only a problem if you aren't getting value. An adviser has an ethical duty to add value for the fees they charge."

He adds that the value of advice can be tangible such as returns on investments or tax savings.

But sometimes the benefits are intangible, potentially coming in the form of peace of mind knowing  your finances are aligned with your life goals.

How can you find a financial adviser?

If you're interested in meeting with a financial adviser, the most important step is to check that they are licensed.

One way to find out is by heading to ASIC MoneySmart's choosing a financial adviser tool. Scroll down and you can search by postcode to find a licensed adviser near you.

The FAAA recommends partnering with financial advisers who are also members of professional associations. These advisers have committed to upholding high professional standards and a rigorous code of ethics.

The FAAA website also has a find a planner tool that lets you look for a professional in your neighbourhood.

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A former Chartered Accountant, Nicola Field has been a regular contributor to Money for 20 years, and writes on personal finance issues for some of Australia's largest financial institutions. She is the author of Investing in Your Child's Future and Baby or Bust, and has collaborated with Paul Clitheroe on a variety of projects including radio scripts, newspaper columns, and several books.