Why 2016 is the year everyone should ask for financial advice
At some point we all need to seek financial advice. But, just as it can be difficult to manage your finances at times, it can also be difficult to figure out what type of advice you’re actually after. We look at the different types of financial advice, so you can figure out which best suits your needs
General Financial Advice
This sort of advice does not take into account your particular circumstances, but is given by someone who holds, or works for a company that has, a financial services license. A good example of this sort of advice would be if you were attending a general seminar about investing. General financial advice comes from a position of authority without observing your situation.
Personal financial advice
On the other hand, if you’re looking for financial advice that takes your own personal situation into account you may need personal financial advice. When seeking this type of advice out it’s important to only deal with a licensed adviser. Be wary too. Many advisers are instructed to try to sell you products that are associated with their brand, rather than giving you what is actually the best financial advice.
There are three different types of personal financial advice you can get from an adviser:
- Simple, once-off advice on one issue – This advice addresses one particular aspect of your finances, rather than your whole financial situation. An example of this would be finding information about the best way you can make contributions to your superannuation.
- Broader financial advice – As you can imagine, broader financial advice is a comprehensive financial plan that will help you set goals in areas such as investments, insurance and retirement planning. Once a plan is set you can go back for further advice if necessary.
- Ongoing advice – Many people employ the ongoing services of an adviser to help reassess their goals, financial position, strategy and investments. Here your financial situation will be reviewed on a regular basis and you generally have to pay some sort of ongoing fee.
Do I really need financial advice?
Well, it really depends on your situation and how knowledgeable you are on the area. A financial adviser doesn’t have a magic wand and can’t make miracles happen, and in the end of the day it’s important to remember they’re not making guarantees, they’re offering recommendations.
Where an adviser is useful is during periods of great change, such as planning for retirement. An independent, reliable adviser can help you make knowledgeable decisions on complicated subjects.
That being said, it is equally important to realised that there is a lot of information you don’t need and advisor to discover, and is generally attained easily enough by researching the topics yourself.
Related links:
The older you are, the better it is for going into business
Petrol falls to lowest in almost 10 months, ahead of Christmas driving season
7 tips for managing debt in retirement