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[SYD] Financial planning advisors - any good/bad stories

Discussion in 'The Pub' started by gegvasco, May 9, 2006.

  1. Have been investigating taking on a financial planner and have done a round of three initial interviews. Even after all that, I am still in three minds about who to go with. What I don't have to aid in selection is word of mouth experiences, good or bad. If you have a story to tell about financial planning, especially Sydney based planners, please pass on your wisdom. I understand if you hold details back being of a financial nature but any general advice would be greatly appreciated.

  2. Gevasco, I am more than sceptical about Financial Planners. Especially those involved in a small firm. I always think that if they were good at their job they would be luxuriating on a beach in the Bahamas with all the money they have made out of following their own advice.

    If you must use one - do so, however there is no substitute for doing the groundwork on investments yourself so you can know if their advice is good or not. You have to take an interest, read the financial pages and watch the market. Visit www.asx.com.au they have some excellent online education classes geared towards beginners.

    Good luck.
  3. Yep tend to agree with 748girl.

    My first test I guess would to make sure that they are registered with the financial planners association [or whatever it is called now].

    Second ask them point blank what commissions they get paid for any reccomended product. {they have to by law tell you but some are more reluctant than others} Gives you an idea if they are shady or not.

    A simple rule with any sales person and these guys are, is to see how much time they spend listening instead of talking. It should be 80% them listening to what you want not 80% of the time them telling you what to do. How can they truly understand you and your circumstances if they don't listen.

    The biggest test of all is Gut Feel, sounds silly but if it don't feel right walk away NOW. :evil:

    Sorry I can't be more specific. :)
  4. I have limited my enquiries to Certified Financial Planners accredited by the Financial Planning Association. So far I have spoken with AMP, Macquarie and ING. As far as gut feel goes, two of the three are riders - we got talking about bikes once they saw "Buy a new bike" as a financial goal.

    I am tying up the last few details about costs because the financial services guide that they have to give you, which is supposed to make it clear as day, is often entirely non-descript. For example, one of the companies gets paid by commission and they state that the initial commision to set things up is anywhere from 0% to 10% of the amount invested. That is an entirely useless statement. And if you ask some basic questions to tie down costs once they have had an initial look at your situation, they often say they can't say because they need to do the 8 hour workup before they can say. This makes it impossible to determine whether a flat fee or commission based payment is the best way to go.
  5. Gevasco,

    I would recommend Macquarie they are good. Watch for the commissions with any firm as Matti-san said. Rule 1 of investing. NEVER borrow to invest in your future. Only invest what you can afford. This is serious - you should NEVER need to sell on a market downward fluctuation or correction to afford repayments - it should only be paper that you are losing on if your investments are good. The market will always recover to exceed its previous highest point. You just have to be patient.* Rule 2. Do not be greedy. If it sounds too good to be true - it is. Recent example Westpoint. Past example: Pyramid Building Society.

    But good on you for thinking of the future - not enough people do.

    *Of course a World Catastrophe might see this to be incorrect - but we just have to hope this won't happen!
  6. The best advice is not to rely on your financial planner for your decision making. Rely on them only for advice, clarification, summarising the details, and setting forth an achievable goal. If a financial planner does their job properly, they empower you with enough worthwhile/releavnt/summarised information to make a decision for yourself, not for them to make it for you.

    With the right financial advice/planning, you will know enough to be comfortable that you have made, or contributed largely, to the decision making and that it is right (with regards to risk and reward) for you. If this is true, then it matters not to you whther or how much of a commission they get paid.
  7. Exactly Jason, which is why I suggested to Gevasco that he do his own homework and explore the courses that the ASX offers if he is new to the game. I don't like Financial Planners much and I have worked in the industry in the past. But I quite like Macquarie. You can do much better for yourself with a decent Stockbroker and a good Accountant and a bit of research. You can never be too careful with your hard earned money.
  8. Thanks guys. Some new perspectives which I hadn't considered before which will come in very handy. I am factoring this sort of thing into my planning for costs ie. which has a one off cost and which has ongoing costs, so that when I know enough after it is all set up and is running, I can go at it alone.