When someone mentions financial planning, what are the first thoughts that come to mind? Too costly, not worthwhile, you don’t have enough to invest, there’s plenty of time to think about it later, or you can do it with online tools?
Some of your perceptions may be accurate, and some of them may be more myth than fact. Before you rule out using financial planning services, take a few minutes to explore some of the more common misconceptions.
They’re All the Same
One mistaken belief held by many, is that financial planners are all the same. However, under the financial umbrella thee is a large variety of specialist topics that different planners address. While most financial planners can advise clients on superannuation and various types of insurance plans, specialist planners have expertise in areas such as self-managed superannuation funds (SMSF’s), direct share ownership, business risk insurance, and business succession planning.
A number of financial planners out there focus on selling financial products to receive commissions or percentage-based trailing fees. However, many of these planners are connected with bank-backed dealership groups. There are also many independant planners (also found on ProAdviser), who prefer to have no ownership influences.
They Get Hefty Kickbacks and Charge Too Much
In Australia, everyone who is authorised to provide financial advice are bound by the Australian Securities and Investments Commission (ASIC) regulations, in order to make transactions as transparent as possible.
Clients must receive a Statement of Advice (SoA) that clearly outlines all monies to be received by the planner for implementing a client’s proposed financial plan. Some financial planning companies operate on a fee-for-service or fixed fee payment structure; they do not receive commissions from any investment products recommended to their clients.
My Accountant Can Take Care of My Financial Needs
While your accountant can take care of many financial needs such as preparing your tax return or advising on small business matters, he or she may not be a qualified financial planner. Your planner will take a more holistic approach to your money matters by focusing on your life goals, creating and managing your portfolio, and helping implement a plan to reach your financial objectives.
Too Young, Too Expensive, Too Poor, Too Little, Too…
Too many people have too many “too’s”! Let’s eliminate some of them:
Before you completely discount the value of professional planning services, take time to explore any pre-misconceptions you may have. You may discover that not only will you highly benefit from a financial planner; they can also save you time and money.
When you are ready to explore financial planning services, contact the financial specialists at ProAdviser.com.au to learn how you, and your financial well being, can benefit from ethical and thoughtful financial planning.
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