The Top 5 Tips For Choosing Your Financial Planner

Choosing a Financial Planner or Financial Advisor can be a difficult process, particularly if you have never had any dealings or experience with financial issues in the past, so here are my TOP 5 TIPS for helping you choose the right financial planner for your particular needs.

1. Firstly, you need to determine if you require a Financial Planner, or a Financial Adviser.

A Financial Planner generally differs from a Financial Adviser in that a Planner provides you with a Financial Plan to help you achieve your goals and objectives whereas a Financial Adviser generally only provides advice relating to specific areas of financial advice (e.g. taxation, superannuation, investment).

There is not much use in paying the least amount of tax, or achieving the highest return on your investment, if you have no specific goal or objective which to achieve from the tax saving or investment return.

For example, your Taxation Adviser recommends you minimise your tax by salary-sacrificing part of your employment remuneration package into Superannuation, but by doing so you are not able to access any of those savings to pay for other goals, such as a new vehicle, or home renovations.

2. Secondly, you need to decide what type of advice you require.

Most Financial Planners will offer several Financial Plan options, so you will likely be able to choose a Plan option that best suits your specific requirements.

For example, if you don't have the time, experience or confidence to manage your own financial circumstances, and you want someone to look after it all for you e.g. manage your

• Loans;
• Superannuation;
• Life Insurances;
• Estate Planning; Taxation;
• Legal;
• and just about everything else!

you will most likely require a Comprehensive Financial Planner that provides an Ongoing Advice Service option.

But if you just need a hand to make sense of it all, and then develop a Plan to make sure you are heading in the right direction such as:

• do you have enough super?;
• when will you be financially independent?;
• do you have enough Life Insurance?;
• what happens if you die?

You may just need a Foundation Financial Plan prepared for your particular circumstances.

3. Meet Several Financial Planners.

The key to a successful relationship with your Financial Planner is to make sure that you can trust them.

But if you have never had any experience with a Financial Planner in the past, it may be difficult to know if you can trust them, especially if you are meeting the person for the first time.

Of course you can obtain referrals from trusted family members and friends, but this is not always a guarantee for choosing a Financial Planner that will suit your particular requirements, as your family member or friends' circumstances may differ from your own.

Once you have some adviser names, it's a good idea to complete some preliminary background checks and a good place to start is the Financial Adviser Register (click here to access the Register), which provides details of each Financial Adviser licensed in Australia to provide financial advice including the adviser's license restrictions; education; and experience.

I would also recommend you meet more than one Financial Planner, in order to be able to have a basis upon which to compare the services offered, and most importantly, to determine if you feel comfortable with the adviser.

4. Understand how the adviser is licensed.

Each Financial Adviser in Australia must be licensed to provide financial advice either as the holder of an Australian Financial Services Licence ("AFSL"), or as an Authorised Representative of the AFSL holder.

Not all licenses enable the Adviser to provide comprehensive Financial Advice, as the licence may be restricted to ensure that only appropriately educated and experienced Advisers provide advice in certain financial products and services.

For example, an Adviser may be licensed to provide Superannuation advice, but as they had no education or experience in providing Life Insurance advice, they are not authorised to recommend and or arrange your Life Insurance.

Another key factor in determining a suitable Financial Adviser, is to understand if the Adviser is restricted to only providing advice on certain financial products for example a banking institution may only authorise their representatives to provide advice on a limited number of investment products (usually their own investment products, or investment products of related entities).

A comprehensive Financial Advise               rshould be able to provide advice on any financial product, including any financial products you may already have (such as your employer Superannuation investment account, or your existing Life Insurance policy).

5. Take your time and choose wisely.

In most cases there is no urgency for choosing a Financial Planner, or obtaining financial advice, and therefore I would strongly recommend that you take your time and choose wisely.

The person you eventually choose to be your Financial Planner is most likely going to be a very important part of your life from that point, and therefore you need to make sure that you develop a strong and reliable relationship with that person, because if you don't, you will not likely maximise your financial potential.

McKinnon Financial Planning holds its own Australian Financial Services Licence and is licensed to provide advice on a wide range of financial products including: cash deposit accounts; debentures, stocks or bonds; Life Insurance products; managed investment products (managed funds); securities (shares); margin lending facilities; and Superannuation.

You can view the McKinnon Financial Planning AFSL by clicking here, and you can also view Dean's Financial Adviser Register record by clicking here and entering George Dean McKinnon in the search field.

If you would like more information about our Financial Planning Services, please don't hesitate to Contact Us and arrange a FREE FINANCIAL ASSESSMENT today because #everyoneneedsaplan to choose the right Financial Planner!