Finding Mr (or Miss)  Right

Finding a good financial advisor is much the same as the hunt for a potential lover – there are so many sharks out there, trying to get their hands on your assets. It’s not surprising that many people turn to the internet and do it themselves.

Recent research by the Financial Services Association found that people with a financial advisor are among the most satisfied investors. But then you would expect the peak body for financial products to say this wouldn’t you?

Using your resources

I’ve always been a big believer in concentrating on your core competency and outsourcing everything else. When we have appendicitis we don’t use our set of steak knives and perform the operation on the cheap.

With something as important as money, most of us can benefit from the guidance of a professional who stays up to date with the continuing changes in the investing world.

Finding a financial planner that you trust and who looks after your best interests is sometimes like trying to find your soul mate at one of those over-28 nightclubs attached to a shopping centre – nothing is as it seems.

“Above all, trust your gut.”

Eighty per cent of the financial services industry is owned and controlled by the financial institutions that produce the product. The Australian Securities and Investment Commission found that in many instances financial advisers acted merely as salesman for the products their employer is flogging.

Knowing the rewards

Back at the bar it’s pretty obvious what the reward is for the bloke who “tunes a chick”.

Equally obvious is the reason he’s so flattering. Take this scenario and apply it to choosing a finance expert.

Most financial planners get paid a commission from the product they sell. Some products pay higher commissions, and many financial planners structure their advice based on the amount of commission they’ll earn rather than what’s best for you. Like finding a potential partner, it’s important not to be intimidated. I’ve met women who could sniff a rat at 10 paces, but were totally screwed by financial planners with grey hair, grey suits and business cards.

Get to know your plannner

It’s your money. Interview them. Ask them exactly why they are the best person to manage your money. Talk about their experience in the industry and their qualifications as an adviser. If they are affiliated with a particular financial institution, discuss how this affects their investment decisions.

Your advisor should be registered with the regulator – make sure at By law advisers must provide you with a copy of their financial services guide which explains the services they offer, how they charge and how they handle customer complaints.

There’s big bucks up for grabs in the financial services industry. The last time I checked no one had opened a Mother Theresa financial planning firm, so if someone is offering to provide you with a “free financial plan”, remember there’s no such thing as a free lunch. You want to know exactly how the advisor will get paid.

Go on your instincts

Above all, trust your gut. If the financial advisor uses complicated jargon, rushes through a plan that isn’t meeting your objectives, or dazzles you with charts and numbers, don’t allow yourself to be sweet talked – walk away.

With any new relationship it’s important to understand what we want, and the same goes with choosing a financial adviser. Think about your financial goals and the things that are important to you.

Many younger people often feel like they are wasting a planner’s time. That couldn’t be further from the truth. Just like a potential lover – if they treat you well there’s the chance they can start a profitable relationship that will last a lifetime.

By taking these steps and asking the questions, you’ll ensure the planner you jump into bed with doesn’t end up ripping you off.

Tread your own path!