Qualifications
There was once a time where becoming a financial adviser was relatively simple; complete a Diploma of Financial Planning, find a licensee who will have you and off on your way. Events such the demise of Storm Financial have led an incredible push to raise the industry professional standards over the past ten years, particularly amongst members of the Association of Independently Owned Financial Professionals (AIOFP). These minimum qualifications should have always been in place, just as they are for a teacher, doctor, lawyer and countless other professions. Needless to say at Maddern Financial Advisers, we have very strict minimum qualification requirements to become an Adviser.
Like any profession, there are always different levels of adviser competency and environments/organisation in which different qualifications are rated more highly. However, you should always ensure that the Adviser you choose has at a minimum the following:
Advanced Diploma of Financial Services
Bachelor Degree
Certified Financial Strategist (CFS)
You may not have heard of a CFS, but it is an extremely important designation for a financial adviser to hold. Undertaking this additional certification ensures that an adviser possesses all the critical elements to give clients peace of mind that they are acting in the client’s best interests with reliable information and advice in a cost effective and conflict free manner.
Independence
An independently owned financial adviser stands out from their peers. Most large financial planning firms and “private banking” services in Australia are fully or partially owned by banks or other financial institutions. Independent advisers are not affiliated with banks or insurance companies, which means we work only for you, the client.
We believe that every investor in Australia deserves the comfort of knowing that their best interests are being put first. An independently owned financial adviser sits in a unique position of being able to research, assess and present all the best options available to a client, and assist in making the best decision for you without the conflict of being affiliated with a financial institution and having an approved investment list that is limited to their own.
The trusted and empathetic Adviser
It goes without saying that a client must trust their Adviser. The media and loves to portray a villain, but in truth with over 18,000 Advisers in Australia there are very few who actually do the wrong thing (of course this doesn’t sell newspapers). That being said, a financial planner is someone who will immerse themselves fully in your life, your family, your aspirations, your finances and in the case of insurance and death; your health and estate planning.
It is essential to find an adviser who you feel completely at ease with, a lot of the information you will discuss is extremely private and often too sensitive to even discuss with friends and extended family. Building a rapport is important, having empathy is vital and knowing that your financial adviser is conflict-free certainly helps to build this trust.
Ask the Adviser about their current clients; how they came to meet them, how long they have been clients for. Often a client is happy to provide a testimonial which you can read, the greatest advocate for a financial adviser is a happy client.
Check the financial adviser register
When you have a short list of advisers, it’s important to check their history, qualifications and current employment status before you approach them about getting advice.
You can check an adviser on ASIC’s financial advisers register, and you can also check the AIOFP for an Independent Financial Adviser here.
The register tells you:
- The adviser’s qualifications, experience and employment history
- What product areas the adviser can provide advice about (check that these are the areas you’re looking for)
- Whether the adviser is a member of any professional bodies or industry associations that are relevant to providing financial services
- Whether the adviser has been the subject of disciplinary action by ASIC
- The name and number of the Australian Financial Services (AFS) licence holder who employs or authorises the financial adviser to provide advice
- Details about who owns or controls the licence holder.
If the adviser is not operating under a licence, do not deal with them – they are breaking the law and you will have little protection if things go wrong.
Make sure you are given a Financial Services Guide
Read the financial services guide (FSG) of any financial advisers you are seriously considering. You can find the guide on their website, or they must provide to you in the first appointment or providing you with advice.
The guide will tell you:
- What services they offer
- How they charge and whether they receive any additional payments or benefits
- Who owns the company the adviser works for (i.e. are they owned by a bank or insurance company)
- If they have links to product providers (many advisers are linked to banks, fund managers and life insurance companies and this can affect the services and products offered, but you can locate an Independent Financial Adviser)
- Their licence number.
If you would like to meet with an independent financial adviser, we offer an obligation-free first appointment with a trusted, CFS Adviser with the utmost industry qualifications. Contact us here.
Disclaimer: The information on this site is of a general nature only. This is not a recommendation or endorsement of any product or investment. It does not take your specific needs or circumstances into consideration. You should look at your own personal situation and requirements before making any financial decisions or consult the advice of an accountant or financial adviser.