Getting financial advice
Getting financial advice
When should I seek out financial advice?
It’s always a good time to seek out financial advice from a planner. Whatever your circumstances, life-stage or how much money you have, financial advice can set you on the path towards being more financially secure.
We know that personal financial issues can be a major cause of stress for people and solving them can bring great peace of mind.
Financial planners are qualified professionals whose advice can help and boost your confidence in your financial choices so you worry less about money.
If you’ve never seen a financial planner before it can seem daunting. We’re here to help. There are some of the common situations in which people tend to seek financial advice, perhaps for the first time. Some of these may be relevant for you.
The value of financial advice
You're in a young mid-life stage
You’re just starting out, entering the workforce, establishing the foundations on which your career will be built. Around this time you may be looking to start a family or even buy your first home.
Choosing the right premixed superannuation investment option/s
As a Super SA member, you’ll have a variety of investment options to choose from. Each option offers different levels of return and suits differing risk appetites. With the help of a financial planner, you may understand these options better and choose an option or mix of options you’re comfortable with.
Budget for your future
A financial planner can help you put together a plan to accumulate the cash you need to take the vacation you deserve. They may also be able to help you put a travel budget together as well as highlight some of the effects your spending may have on your future.
Getting married can be a stressful time. The average wedding and honeymoon can be expensive. Often, couples go into post-honeymoon debt. With financial advice, you may avoid these challenges or be able to navigate them with less tension.
Having your first child
Having a child comes with endless expenditures that can include medical costs, insurances, baby seats, prams, food, clothing...and a myriad of other costs. A financial planner may be able to help you put together a plan to help you get through these financially trying times.
Sickness and/or injuries are inevitable so taking out insurance to protect yourself and your family is a good idea. The challenge is there are a million options out there. With the help of a financial planner, you may be in a better position to pick the options most appropriate to your family’s situation but also perfect for your budget.
Purchasing your first home
Putting together the deposit to buy your first home is no small feat. And neither is consistently paying down the loan over a lengthy period of time. With the help of a financial planner you may be able to purchase your first home with a solid game plan that sees your mortgage repayments making less of an impact on other parts of your life.
You're in a mid-life stage
By this time, you’re trying to consolidate all that you’ve gained and your expenses may have increased. You’re trying to make your lifestyle more comfortable. At the same time, your eyes are on the future and what it may bring.
As your career or business progresses, it’s likely you’ll be earning more and more money. If you have excess cash, it’s wise to make it work as hard as possible, so you can relax later in life. With countless investment options available, a financial planner may be able to help you choose the investments that work best for you.
Paying for home renovations or extensions
It’s inevitable your home will need maintenance and/or structural repairs. You may even want to add extensions to your home as your family grows. Financial advice may get you ready for the inevitable or help you to enhance your home.
Managing your debts
If you’re not careful, it’s easy to rack up a lot of debt. It’s also easy to lose sight of these debts. A financial planner may be able to help you stay on track to pay them all off or at the very least, paying minimal interest on them.
Inheritances come in many different forms. They can be anything from a treasured possession through to cash, property, shares or even superannuation. Inheriting anything may come with complex tax considerations. A financial planner can walk you through all of the things you’ll need to consider.
Sometimes, unfortunate events can occur which result in an inability to work due to sickness and/or injury. This means loss of income. A financial planner may be able to help you prepare for the unexpected by helping you choose the appropriate income protection insurance.
Planning for long-term care
If your loved ones are getting closer to a time where they can no longer take care of themselves and require long-term care, a financial planner might help with strategies to fund accommodation costs, maximising Government pensions, minimising nursing home fees, and more.
Planning for retirement
When you’re in the later stages of your mid-life, it’s not unusual to begin thinking about retirement. A financial planner might help you think about what your retirement needs are going to be, decrease outstanding long-term debts, planning a superannuation and Income Stream strategy and much more.
As you get closer to the end of your working life, you’ll start thinking about what to do after you’ve finished up. What occupies your mind may come down to how ready you feel and what you’ve achieved through your life.
More often than not, people are focused on acquiring assets, not protecting them.
But, partnerships can break down and some people may even challenge your estate after you die. A financial planner may be able to advise on the ownership of possessions, structuring your assets and getting the right insurance in place.
As your career or business progresses, it’s likely you’ll be earning more
It’d be very stressful to enter your pre-retirement phase with a multitude of large debts still outstanding. Financial planners are experts at developing strategies to eliminate debt through the management of investments, setting up debt repayment plans, estate planning and more. They’re also there to keep you motivated and make sure you get that debt down.
Helping your kids
As you begin considering retirement, there’s a likelihood you’ll want to help your kids with their financial challenges. A financial planner may be able to help you understand how you could help your children on the path to their financial independence while simultaneously avoiding the pitfalls of financially rescuing your children or lending money you can’t afford.
Review your insurances
Now that you’re closer to retirement and your assets are higher, debts are lower and your children are more financially independent, it’s a good time to review your insurance needs.
A financial planner can help you determine the right types of cover for your stage of life.
Wills and trusts
If you have a healthy amount of money and assets, you may want to express your love by giving some of that money to your children, grandchildren or even a cause you believe in. A financial planner might help connect you to the right legal people to draft wills and get estate planning under way.
Preparing a retirement plan
Depending on the complexity of your finances, it may be difficult to get complete transparency on how much you’ll need to enjoy your retirement, especially a retirement that’s comfortable for you. A financial planner may be able to help you develop an understanding of whether you’re on track to achieving the retirement you want.
It’s time to let go, have some fun and live your best life. Travel the world and see the sights you’ve never seen. Indulge in hobbies or find new ones. Enjoy spending time with your family. You might even want to give some of your wealth away.
Aged care planning
No longer want to live in your own home? A financial planner might help make your transition to aged care a smooth one. They may help you to have the lifestyle you want while minimising both entry and ongoing expenses. They may also get you thinking about how your decisions can impact your age pension eligibility.
If you’ve done well, your trips away won’t be weekend affairs. They might be lengthier holidays that could last weeks or even months. A financial planner can help you understand how much you can afford to spend on travel so you can go on that trip of a lifetime.
Inheritance tax mitigation
In Australia, we don’t have inheritance tax. Assets passed down are exempt. However, what is passed down can impact a family member’s financial position and in turn, impact the taxes they pay. A financial planner may help clarify the tax implications on additional income, capital gains from asset sales and super inheritances.
Gifting your family
With plenty of cash and assets, you may be considering giving some money to family members. A financial planner may be able to discuss the impacts it will make on you, the possible emotional impacts on your family and the limited circumstances by which the Australian Tax Office can tax these gifts.
Having worked so hard to earn what you have, it’s only natural to want to preserve those earnings as much as possible. A financial planner may help you decide on fixed interest strategies that limit volatility while simultaneously providing high levels of liquidity moving forward.
Estate planning is more than just putting a will together. It’s about working out what you want to have happen to your assets and affairs when you pass, but also who takes charge if, for whatever reason, you can no longer make decisions. A financial planner may be able to guide your decisions, help you understand the tax that may be payable on a death benefit paid out of your super fund, connect you with estate lawyers and more.
When you retire, a variety of Centrelink benefits may become available to you. A financial planner may be able to help you develop a deeper awareness of these benefits as well as the best way to structure your income and assets so you can make the very most out of any of the benefits available to you.
A few more facts about financial advice
Survey-based research conducted in 2014 showed that✓ Investors who received advice over four to six years accumulated 69% more assets than those individuals who had no advice.
✓ Investors who received advice over 15 Years accumulated 290% more assets than other comparable households.
Source: The Gamma Factor and the Value of Financial Advice (Aug 2016) Cirano