Planning for your First Appointment with a Financial Advisor

So you’ve decided to meet with a financial advisor. The next step is to get ready to make the most of your first meeting. The better prepared you are, the better quality conversation you can have.

It starts with a conversation

Your first appointment with a financial advisor is a ‘get to know you’ session that helps your advisor understand your financial situation before they make any recommendations.

You might be interested in a specific piece of advice, like life insurance or superannuation, or more holistic advice about your finances in general. Either way, most advisors will look at your complete financial picture as different aspects of your finances are often connected.

What to take?

  • A summary of your assets (home, car, investments etc.) and liabilities (loans, credit cards etc.)
  • An estimate of your monthly income and expenses
  • Your most recent tax return or pay slip
  • Your most recent superannuation statement
  • Policy Schedules for any life insurance policies you have
  • Your Tax File Number

What to think about?

What are the big goals (financial or otherwise) you’d like to achieve in the next:

  • 1-2 years
  • 3-5 years
  • 5-10 years

What they should give you?

  1. A financial Services Guide stating their relevant qualifications, license number and fees.
  2. A Statement of Advice (SOA) which incorporates facts and goals about your life, compares fees, lays out all possible outcomes and areas of concern, and then offers a recommendation. This document is typically provided at a later date.
  3. An understanding of how often your plan will be reviewed.

What happens next?

Your advisor will return to you shortly after the first meeting with their recommendations and proposed costs, which will be included in a ‘Statement of Advice’. They will talk you through their recommendations and allow you to accept or decline the offer to go any further.

Your advisor will typically charge you for preparing your Statement of Advice regardless of whether you go ahead with their recommendations. But don’t worry, you will be asked to approve any costs before they are committed.

If you’re not comfortable with anything the advisor has recommended, have that conversation before your plan is implemented.

Financial advice is an ongoing process, so expect your advisor to invite you to review your plan every 1-2 years. The frequency and scope of these meetings is something you can discuss with your advisor, but the main thing is to make sure you’re getting what you want from the relationship.

Warning signs for poor advice

Before you agree to proceed with your advisor’s recommendations, there are some warning signs you should look out for:

  • Your advisor hasn’t asked you many questions about you and your goals for the future.
  • They’re pressuring you into deciding before you understand what you’re buying.
  • They haven’t asked you about your budget or living expenses.
  • They haven’t explained the features and options of the product(s) they’re recommending.
  • They haven’t explained stepped v level premiums and how that will impact what you pay over time.
  • They haven’t discussed insurance through super or reviewed your existing super arrangements.
  • They haven’t provided you with a Financial Services Guide or Statement of Advice.
  • They haven’t explained their fees or what commissions they will receive.

If you experience any of the following warning signs, you may want to ask more questions or try a different advisor.

For any Financial Services assistance, please speak to a Financial Planner now at BW Private Wealth Financial Planning | Ballarat | Ararat | Surrounds

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