Independent financial advisers and planners in Australia

In this article:

• What does a financial adviser do?
• What is an independent financial adviser?
• How much does a financial adviser cost?
• Potential benefits of using an independent financial adviser
• Potential disadvantages of using an independent financial adviser
• List of independent financial advisers in Australia
• How to find a financial adviser

What does a financial adviser do?

A financial adviser, or financial planner, is someone who can help you set your financial goals and make a plan to help you achieve them. Financial advisers can typically provide advice on areas such as investing, superannuation, retirement planning, estate planning, risk management and insurance. Some financial advisers may also be licensed to offer tax advice. Advice can range from one-off advice on a single issue to ongoing advice.

What is an independent financial adviser?

Financial advisers can only legally describe themselves as being ‘independent’ if they do not receive any commissions (unless rebated in full to their clients), volume-based payments (i.e. payments based on how much business they send to a financial product issuer) or other gifts or benefits from a financial product issuer. These requirements are set out in the Corporations Act. Due to these rules, a relatively small number of financial advisers in Australia are considered ‘independent’.

It’s worth noting that all financial advisers must have an Australian Financial Services (AFS) licence from ASIC, the body that regulates financial services. Following the Royal Commission, financial advisers are also now required to meet some additional professional standards. This includes having an approved bachelor’s degree as a minimum, sitting an exam set by the Financial Adviser Standards and Ethics Authority (FASEA) and complying with a Code of Ethics that requires them to, for example, act in the best interests of clients and avoid conflicts of interest.

Advisers can also choose to become members of the Profession of Independent Financial Advisers (PIFA), if they meet certain criteria.

To be a Practising Member, PIFA says that advisers must meet the following three criteria. Specifically, they must:

1. Have no ownership links or affiliations with product manufacturers
2. Receive no commissions or incentive payments from product manufacturers
3. Receive no asset-based fees (fees based on the total value of assets in a client’s portfolio).

To be an Associate Member, PIFA says advisers must comply with the legal definition of independence, or be “actively transitioning their practice to become independent”.

How much does a financial adviser cost?

The cost of receiving financial advice can vary depending on the complexity of the advice, as well as the fee structure the financial adviser uses. On average, the Financial Planning Association (FPA) found that planners charge an initial fee of $3,300 to set up a plan and then about $4,300 annually for ongoing advice.

In addition to fixed fees, ASIC’s Moneysmart notes that advisers may charge percentage-based fees, such as asset-based fees or fees based on the performance of your investments. However, independent financial advisers who are Practising Members of PIFA are not allowed to charge asset-based fees.

Potential benefits of using an independent financial adviser

One benefit of choosing an independent financial adviser could be the reassurance that the advice given should be impartial and not based on sales incentives.

There are also a number of potential benefits to using a financial adviser in general. For example, they could help you:

• Identify short-, medium- and long-term goals
• Create practical strategies to achieve these goals
• Feel more in control of your finances
• Develop an investment plan
• Protect your assets
• Plan for retirement

A financial adviser may be particularly useful during big life events, such as if you are buying a home, starting a family, inheriting money or approaching retirement. When you reach your preservation age, for example, and decide to access your super, you may like to speak to an independent financial adviser to support you with planning for your future financially.

Potential disadvantages of using an independent financial adviser

One potential disadvantage of using an independent financial adviser is their relative scarcity. At the time of writing, there are fewer than 70 independent financial advisers in Australia who are members of PIFA. This may mean you need to travel for a consultation or have over-the-phone or online consultations in some cases. It could also mean fewer advisers that you can compare.

More generally, seeing a financial adviser can be expensive. Not every situation will necessarily call for a financial adviser, so you might want to think about what kind of financial help you need before committing to an adviser. For example, if you’re after financial information rather than advice, it might be useful to talk to your bank, super fund, insurer or other financial institution. If you want advice on your superannuation, you could also consider getting advice through your super fund. You may be able to get simple advice at no additional cost; however, there is typically a fee for more comprehensive advice.

If you need help with debt or other money problems, you may be better-suited to seeing a financial counsellor. Financial counselling is a free, independent and confidential service. You can speak to a financial counsellor by calling the National Debt Helpline on 1800 007 007.

List of independent financial advisers in Australia

Below is a list of independent financial advisers in Australia, sorted by state and territory. This list is based on PIFA Practising Members and Associate Members across Australia, according to the PIFA website at the time of writing.