What to ask when meeting a financial planner

There are a number of reasons you might choose to consult a financial planner, whether you’re working on starting a business or a property portfolio, consolidating assets with a spouse, or simply hoping to achieve more control over your finances.

Before your first meeting, it can help to know what you’ll need ahead of time, and this is where our financial planner checklist could come in handy.

What is a financial planner?

A financial planner (also known as a financial adviser) is a registered and qualified professional who can provide advice to help you meet your long-term financial goal.

They do this by working out where you stand in terms of what you own (your assets), what you owe (your liabilities), your potential investment opportunities and what insurance you need to protect those assets and investment opportunities.

They then outline a program for you to follow in order for you to achieve your financial goals.

How to find a financial planner

There are many ways to find a financial planner or adviser but you need to check they are qualified and registered to offer financial advice. They need to have an Australian Financial Services (AFS) licence and must be listed on the Financial Advisers Register, which you can check online for free.

The register is managed by the Australian Securities and Investments Commission (ASIC) and any listing should include a planner’s name, work history, qualifications and training, and list the financial products they can advise on.

All planners and advisers must pass a financial adviser exam, administered by ASIC.

Chair of the Financial Planning Association of Australia (FPA), Marisa Broome, told Canstar your relationship with a financial planner is likely to be ongoing.

“You might not see them every year but one would expect that you would work with them over a long period of time,” she said.

You can do a postcode search for registered planners in your neighbourhood, or you can see if any of your friends use a planner.

“If you’ve got a friend that has a financial planner that works for them, it’s quite likely that that will work for you,” she said.

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What does a financial planner do?

A financial planner can suggest ways that may help your assets grow in value over time. They can suggest ways that may help prevent you or your family from suffering undue hardship if you couldn’t earn your usual income due to illness or injury.

“It’s a relationship based on trust and you have to work together,” said Ms Broome.

But getting the most out of your meetings with a financial planner depends on how well prepared you are for those meetings.

7 step checklist: What questions to ask when you meet with a financial planner?

Step 1: Check the financial planner’s credentials

When considering a financial planner it’s important you check their licensing credentials and their Financial Services Guide (FSG), which should be listed on their website. They must provide you with a FSG that states their relevant qualifications, licence number and fees.

Only deal with a planner who is a licensed, authorised or certified representative.

Moneysmart recommends you check any potential planner’s fees and charges, whether they get any commission on products and services they recommend, and whether they charge a percentage fee based on the size of your portfolio.

Step 2: Consider your current position and future goals

If you decide to go ahead and set up a meeting, a financial planner will need to find out more about you. They will ask all sorts of questions so they can get to know you and where you are at in life with your financial affairs. This process is often called the ‘fact finding’ stage.

You will need to be prepared so you can answer these questions. You might want to bring along copies of your recent financial statements for any bank accounts and credit cards, details of your home loan, any personal loans or car loans, HECS or HELP debts or study loans, or buy now pay later (BNPL) debts, superannuation fund statements and life insurance details.

Have a good idea of your weekly budget for essentials, regular bills and your discretionary spending habits.

Take along or know your full health history, family history and doctor’s name and address details, as insurance applications could ask all sorts of questions.

To make sure you get the most out of this first meeting, think about your financial goals or wishlist beforehand. Don’t just answer their questions about your current financial situation – tell them where you would like to be in terms of your finances.

It’s a time when you can evaluate the planner – make sure that you feel comfortable with them.

The Financial Planning Association of Australia says a sure sign of a good financial planner is that they don’t rush you. They should listen carefully to you and clearly explain where they can and can’t help you.

Step 3: Ask plenty of questions

The financial planner will identify your needs and highlight any issues of concern.

This is a great time to ask questions, so don’t hold back.

As they’re outlining things you need to consider, don’t hesitate to ask for clarification if you don’t understand something they say. After all, they’ve likely had a lifetime of studying and working in the financial field and you probably haven’t, so if you’re confused, shout out!

Step 4: Start to think about your strategy

The financial planner will then prepare their strategy and recommendations for you.

They may give you some indication of this at the time, but they won’t give you their recommendations in full until they have fully thought it out and written it up in an official document.

They may post this to you and organise a second meeting for you to confirm whether you would like to implement the plan or make changes.

All recommendations must be in the form of a Statement of Advice, which is a written document. Make sure your planner provides this and check that it fully addresses your needs and goals.

Moneysmart says this document should also detail any fees and how they should be paid.

Step 5: Discuss recommendations in detail

At a second meeting, your financial planner will discuss any recommendations with you in greater detail, and you can then decide whether you want to proceed or not with implementing that plan.

Make sure you understand the recommendations fully before agreeing to anything. Don’t be afraid to ask lots of questions.

Step 6: Sign any necessary paperwork

If you decide to go ahead with the planner’s recommendations, you must sign any relevant documentation to implement and proceed with those recommendations.

This will require filling out the relevant application paperwork for the types of products you are considering, such as any insurance application, loan application, superannuation rollover request and so on.

Moneysmart has some useful tips on how to protect your money when dealing with a financial planner. It says you should be careful about what authority and access to your finances you give to your planner, and never sign a blank document.

Step 7: Review your progress regularly

Your planner will review your financial situation on a regular basis.

Agree with your planner how often your review may be required, such as annually or half yearly.

Make sure you keep a check on any statements and transactions, and keep track of any investments agreed as part of your plan.

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