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Independant Financial Planning

Discussion in 'Financial Planning' started by kizz, 20th Mar, 2010.

  1. kizz

    kizz Member

    10th Mar, 2010
    Hi everyone,

    I've decided I want to speak with a Financial Planner. I feel I'm getting overwhelmed with all the different types of investments, super, tax, so I want to speak with the pro's about it and get a complete financial health check and then hopefully devise a financial plan for me.

    If someone could recommend an Independant Financial Planner in the ACT region that would be awesome as well!

    I did a quick search and have a better understanding of the difference of a Financial Advisor and Financial Planner, so, I am actually wanting to speak with a Financial Planner.

    Would people here agree that an Independant Advisor/Planner would be best? I'm not interested in being convinced that "their" product is exactly what I need when it might not be.

    And, Is there anything I should know or do before I make a booking? I've got a budget that I follow religiously, as well as some goals I'd like to achieve with time frames.

    Also, What kind of questions should I ask him/her in the first visit?

    Thanks in advance, and sorry for so many questions :)

  2. whitgr

    whitgr Member

    3rd Jun, 2009
    Hi there

    Why don't you try calling Park Hill Financial Group at Home Page. They operate down your way and and can help you out
  3. Jacque

    Jacque Team InvestEd

    16th Jun, 2005
    Hi Paul and welcome to the forum

    It's certainly not easy finding a truly independent FP. They are a rare breed as most FP's tend to fall into the category of "glorified fund manager salespeople". When any advisor providing advice is paid a commission or fee by a product they're recommending, its almost impossible to provide advice of an independent and unbiased nature.

    I recently had the good fortune of presenting to a group of independent financial advisers who charge a fee for service and when I probed further about the differences I received this explanation from them which I think sums it up nicely:

    As discussed, there are not many financial planners like us who can use the term ‘independent’. This is because they can only claim that they provide independent advice if they meet the criteria of sec 923A of the Corporations Act. Broadly the requirements are that the financial planner and the Licensee cannot receive any of the following:

    (i) commissions (apart from commissions that are rebated in full to the person's clients);
    (ii) forms of remuneration calculated on the basis of the volume of business placed by the person with an issuer of a financial product;

    (iii) other gifts or benefits from an issuer of a financial product which may reasonably be expected to influence the person

    Importantly they must also operate free from direct or indirect restrictions relating to the financial products in respect of which they provide financial services and must operate without any conflicts of interest that might arise from their associations or relationships with issuers of financial products. This is difficult for most financial planners as they directly or indirectly represent product providers such as banks.

    While the rules are strict they are designed to ensure we represent our clients and are free from conflicts of interest.

    I'm sorry I can't help you with an ACT recommendation however if you're after someone for NSW I can highly recommend someone. Best of luck with it all.
  4. Dolfinwise

    Dolfinwise Well-Known Member

    30th Sep, 2009
    Independent advice

    As Jacque says to satisfy the letter of the law and claim independence is rare. This is due to the way the law is framed making it virtually impossible to meet and provide good advice. Even many of those who do feel able to claim independence actually often don't meet the letter of the law when it comes to the requirements about immediately rebating any commissions received.

    However don't let these technicalities prevent you getting advice. There are very good advisers around that do put their clients interest first.

    The best guide for you is:

    Choose an adviser whose business and licensee is not owned or associated with a product group. While not in the majority there are quite a number of these.

    Make sure that the adviser when you then meet is not going to recommend any products in which he or his licensee has any ownership in.

    Also ask to be engaged on a pure dollar based fee basis for both upfront and ongoing advice. (no percentage of assets)

    There are growing numbers of advisers willing to work on this basis and you will generally find they are the quality operators who back the value of their advice.

    Good luck with it
  5. Lloyd Harris

    Lloyd Harris Member

    27th Feb, 2010
    Gold Coast, Qld
    Hi there,

    I think something which is often overlooked is the gut feeling you get from a potential planner. I have worked with financial planners in 'independant' land, and within banks, and can say that there are excellent advisers working in both spaces.

    If you have existing policies (i.e. super or investment or insurance) and the new adviser is recommending you move these into a new policy (at your cost), make sure you genuinely understand the benefit to you.

    Unless you have the money to pay an adviser $300+ per hour, and at least $5000 for a full plan, I would urge you to understand that the adviser will need to be paid (at least in part) by product based commissions (such as on insurance policies). This is not necessarily a bad thing. It is extremely expensive to run a profitable financial planning business, due in large part to the rules put in place to 'protect the consumer' (ironic yes?).

    This is why I bring you back to the 'gut feeling'. There is nothing quite like it when it comes to judging character. Don't be afraid to take a friend along who has experience in such matters also.

    Best of luck.

    P.s. I am in QLD so unfortunately cannot help you with a good planner recommendation. Contact the Financial Planning Association, and ask for some options near you.

    Cheers, Lloyd.