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What should you expect from a financial adviser?

Oct 5, 2021

What should you expect from a financial adviser?I have worked in the financial industry for over 25 years and there is very little I don’t know about investing and managing money, yet I use a financial adviser.

About 15 years ago I realised that while I knew about investing and money, I needed to have the input of someone who was not emotionally involved in my money and family. I also realised that while I was writing about finances, I was not spending any time looking at my own financial situation.

I remember having to get all the bits and pieces together for that first meeting. I spent my time searching for elusive pieces of paper and trawling my inbox for financial statements.

It was a partly frustrating, partly liberating experience, as the aim was to get all our family’s financial paperwork together so our financial adviser could provide us with a full financial assessment. It was a sobering exercise realising how disorganised we had become.

It was also an interesting exercise, as our financial adviser asked a lot of questions about the future.

When were we planning to replace our cars? What are our retirement goals? For how much longer would we be supporting our children? These were important discussions that our family needed to have.

Creating a roadmap for your money

Our adviser came back with a holistic plan that met our objectives and gave us a roadmap that we still use. Every year we touch base and if there is a change or a new investment I want to consider, I run it past my adviser for a different perspective.

This is what financial advice is about. It is about creating a roadmap for your money – it is not about selling policies.

The Financial Planning Institute of Southern Africa has been working hard to change the perception of financial advisers from being product pushers towards being recognised as professionals who provide advice that is worth paying for.

The institute has continuously called for a separation between fees for advice and sales commission, as well as a professionalisation of the financial advice industry.

In order to belong to the institute as a certified financial planner, an adviser has to have a postgraduate diploma in financial planning, pass a rigorous professional competency examination, obtain three years of practical experience, as well as pass a criminal and financial background check, all of which can take up to eight years to complete.

The separation of commission and advice fees has seen changes in how advisers charge for their time.

There is a growing body of financial planners who charge for their time, as with any professional. This means they do not have to sell a policy to pay for their expertise.

Some will be open to a negotiation, where you can pay their fee over time, or offset it against investments you may take. This forms part of the first conversation you should have with your adviser.

The first meeting is always free of charge, as it is the opportunity to find out how the adviser works and whether they are able to meet your needs.

What to look for in a financial adviser

If you want to know if your adviser is really focused on giving good advice, see if they have the following attributes:

  • They start by finding out about you rather than explaining their products;
  • They will ask you about your financial goals or dreams, both short term and long term;
  • They will look at your overall financial situation, including your budget and your debt repayments;
  • They may recommend you pay off your short-term debt before starting to invest;
  • They have an ongoing relationship and regularly communicate with you;
  • They have been recommended by friends and family – recommendations show that your adviser is good at maintaining relationships; and
  • They belong to a professional body like the Financial Planning Institute of Southern Africa.

Free advice

As part of Financial Planning Week from 4 to 8 October 2021, the following certified financial planners will be offering free financial planning consultations. Appointments will be subject to availability. Use the telephone numbers and email addresses provided below to set up an appointment.

Pretoria
Anton Schutte from the PWG Group – email anton@pwggroup.co.za
Johan Roux from BDO – tel: 012 433 0160 or email jroux@bdo.co.za
Belmira Gumbe – email bpgumbe@gmail.com

Kimberley
Henri le Grange from Le Grange and Associates – email hlegrange@oldmutual.com

Thohoyandou
Mulalo Nemataheni from ImPowerX Advisory Services – email: mulalonemataheni@yahoo.com

Nelspruit
Simon de Laat from Masthead Financial Planning – email sdelaat@mastheadfp.co.za

Durban
Melony Jacoby from MVR Financial Advisory Services cc (Musgrave) – email: melonyj@mvestfin.co.za
Hedley Lamarque from BDO – email hlamarque@bdo.co.za

Johannesburg
The Financial Planning Teams from the BDO offices in Johannesburg – tel: 011 488 1700
Peter Harten – pharten@bdo.co.za
Desiree Raghubir – draghubir@bdo.co.za
Miré Delport – mdelport@bdo.co.za
Talya Snowball – tsnowball@bdo.co.za
Radhika Daya-Mistry – rdayamistry@bdo.co.za

Cape Town
The Financial Planning Teams from BDO in Cape Town – tel: 021 417 8800
Lisa Griffiths – lgriffiths@bdo.co.za
Sue McLennan – smclennan@bdo.co.za

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Maya Fisher-French author of Money Questions Answered

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