A financial adviser ensures that along the way towards saving for your life goals, nothing is left to chance. You have an end result and you simply work backwards and plan every last detail.
This does not mean that you, the client, needs to know all the strategies and legal and tax implication—that’s the planner’s job. However, the client needs to be aware of the disciplines of managing their own cash flow. Cash flow management is the main driver and the separator between success and failure in any financial objective.
A financial planner cannot guarantee returns (if one does then run the other way quickly). The role of a financial planner is to demonstrate the relativity of market returns between the asset classes you are looking to invest in.
An adviser should provide detailed advice around:
• General banking matters, debt management such personal, investment and home loans
• Wealth accumulation – various strategies and options
• Comprehensive advice on all investments including direct investments
• Cash flow management
• Debt reduction solutions.
• Retirement strategies
• Personal risk protection.
• Be able to identify a tax situation or consequence and then refer them to an accountant.
• Understand estate planning issues and discuss how to best deal with them.
Importantly, there must be mutual respect and liking between adviser and client. I have no interest in how much money someone has to invest if they don’t first adopt the attitude of listening to what my advice will be. If you think you can do it all yourself, then an adviser is not for you.
So, is it hard to find an adviser? What is a good test? The following are some key areas for you to consider when interviewing your financial adviser.
• Attend one of the many free seminars that are always offered by financial advisory firms.
• Ask for a referral from a friend
• Ask your accountant or another professional body.
• Visit the Financial Planning Association’s website (see the Resources section of this book).
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