Who really needs a financial adviser? - Getting the most from a financial planner series: #3 January 19th, 2023

Continuing our series on "Getting the most from a financial planner". If you haven't read the rest of this series, you might want to start with "Part 1: An overview of the industry" or "Part 2: Finding a financial planner, and what to look out for."

One of the big questions you need to ask yourself is; “Do I actually need a financial adviser” ?

Is it worth me shelling out thousands of dollars to get my financial plan done by a pro and once in place, paying thousands more each year to have them hold my hand?

Apart from things like medicine and dentistry, its probably fair to say that we can do most things ourselves if we have the time, patience and discipline. You can prepare your own accounts and lodge tax returns with the ATO, represent yourself in court on legal matters and indeed, do your own financial plan.

There’s a lot that goes into it and knowing the tricks, tips and shortcuts can make a big difference. There’s nothing worse than discovering there was a better and easier way to do something, after the event. That’s where a planner can make a huge difference, knowing things that you’ve never thought about and building that into the plan.

“Move X into Y and transfer this amount to your partner’s super and you’ll qualify for concession cards that will save you thousands of dollars each year” - kind of stuff.

If you’re already across most of the technical details, filling in the blanks might involve a quick-fire question and answer session with a planner. The trouble is, there’s not too many good planners who offer that “brain-picking” service. At Netplan, we’ve been building a Q&A collection for many of the questions our clients have had over the past 35 years. That back catalogue is part of our premium subscription.

What's it like engaging a financial planner?

Engaging a financial planner is a bit like getting an architect to design your dream home.

After finding out exactly what you want, a written financial plan is produced. In a way, it is similar to the architect’s engineering drawings produced at the end of the process. Called a statement of advice or SOA, it spells out what, how and when.

Ongoing service is the other big expense and because the engagement lasts years, this is the more profitable part for the planner. Using the Architect analogy, you might get the same Architect to now build the structure and maintain it over the years.

Your good planner becomes your 24/7 sounding board for whatever comes your way. It becomes a team approach with you and the adviser working towards the same goals.

Death of loved one, a separation, an inheritance, a medical condition, retirement, buying a new car, a share-market crash. Picking up the phone and calling your adviser about these things is part of the ongoing service that you should expect and with good planners, included in the ongoing adviser fee.

The good adviser is the steady, calm professional who can tell you the easiest and best way to do what you want to do.

Sometimes there may be disagreements about what’s best – but like a good team player, the good planner should be able to explain in clear and concise terms why they recommend a particular approach.

If you are in retirement, the good planner will be liaising with Centrelink on your behalf and lodging the updates you may be required to provide.

Above all, you’ll feel like you’re getting good value for money.

If not? find another adviser or stop paying the fee. Its that simple.

So do I need a financial adviser?

Well first, whether you need a financial adviser isn't related to whether you have $40,000 in the bank or $2,000,000 in the bank. It's about whether you feel like you're in control of your retirement and financial situation. We have had clients across this entire spectrum over the years, and often there's ways that things can be tweaked and improved for all of them.

However, if all of the above sounds like a lot to handle as an individual, we understand.

The good news is that if you want to DIY your retirement plan, it is possible. You likely just need a step by step guide to build on what you already have and make sure you're getting the most out of your tax, superannuation and Centrelink options. This is what we're helping you do at Netplan, by giving you a holistic view of retirement, rather than just small components of it.

Even if you start out going the DIY route, you can then go and find a financial planner as explained in "Part 2: Finding a financial planner, and what to look out for.".

The benefit to taking this route is that you aren't going in blind, you can ask the right questions, and fully understand the answers you get from your adviser. In the long run, this approach can save you money and if you're the kind of person who likes knowing how things work, you'll have peace of mind.