What should I look for in a financial adviser?

Research shows that just 20% of New Zealanders received professional advice in 2023, and those who do are more confident and have better financial wellbeing. So how can you choose your own adviser?

A good financial adviser is worth their weight in gold. They’ll listen to what you want and need then create a plan for you to follow - so that you know what you need to do to improve your financial situation.

However, all financial advisers are not created equal. Here’s everything you need to know to find a good one. 

Where to look for a financial adviser

You can search for a financial adviser the same way you would for any other service provider:

• By getting recommendations from friends or family.
• Jumping on Google and searching for financial advisers in your area.
• By searching the Financial Services Provider Register.
• By getting recommendations from other professionals you trust, such as your mortgage broker.

How to check your adviser out

While searching for an adviser is easy, choosing one can be a bit more time consuming. It’s important that you take steps to verify that whoever you choose is qualified, experienced and can provide a quality service:

• Check reviews on Google.
• Check that they’re licensed to provide financial advice. To do this check if they are on the Financial Services Providers Register here.
• You can also check if they are members of Financial Advice NZ as members agree to adhere to their Code of Ethics.

Once you’ve checked a few advisers out, it’s a good idea to talk to two or three of them to decide if they are a fit. Most of them should offer a free initial meeting.

Speaking to your adviser

When you speak to your financial adviser one of the most important things is to figure out if they’re a good fit. Do they make you feel comfortable? Can they relate to you and understand your financial situation? 

Next it’s worth getting direct and asking your adviser how they’re paid. Some charge an hourly rate or are paid a salary, others don’t charge at all but receive commission from the products they recommend.

Free advice is tempting and can be great, however, you should keep in mind that these advisers may be biased toward recommending certain products that pay higher commission. However, an adviser should only recommend products most suitable for their client, regardless of the level of commission they receive.

You should also feel free to ask about their experience, whether they have a speciality and if they can describe the service they provide.

What a financial adviser does

Once you’ve chosen the right financial adviser for you, you can expect them to help with almost anything to do with money. Here’s how it’ll work:

• They’ll figure out what your goals are.
• Next your adviser will work to understand your financial position, looking at your income, assets, debt and current investment strategies.
• They’ll prepare a financial plan that includes recommendations for strategies, products and services that will help you reach your goals.
• Last of all they’ll help you implement the recommendations in the plan. 

It's a good idea to schedule regular reviews with your financial adviser as your goals, lifestyle and circumstances change to make sure your plan is still working. Once a year is usually often enough.

Throughout this entire process your financial adviser should put your needs first, be professional and respectful. Everything you discuss with them should be completely confidential. 

Disclaimer:

This ‘What should I look for an in financial adviser?’ blog is general information only. The views and opinions expressed do not necessarily reflect those of the FSC. It is not intended to constitute legal or financial advice and does not take your individual circumstances and financial situation into account. We encourage you to seek assistance from a trusted registered financial adviser, legal or other professional advice.

The names of any third parties are additional resources that you access at your own risk and the FSC takes no responsibility for any third-party content.

The FSC and its employees make no express or implied representations or give any warranties regarding this blog, and we accept no responsibility for any loss, damage, cost or expense (whether direct or indirect) incurred by you as a result of any error, omission or misrepresentation in this blog.  

May 2024.