How to find a financial adviser

How to find a financial adviser

With so many financial advisers to choose from, finding the one who's right for you can be a real challenge. How do you know whether you even need an adviser, what to look for, and how to find someone you can trust with your financial future?

In this video, Brett Davidson of the consultancy FP Advance, which helps advice firms serve their clients better, offers practical guidance on how to find a financial adviser. He begins with an honest point: not everyone needs one. If your finances are relatively simple, paying off the mortgage and getting the children through school, you may be happy managing on your own. But once things become more complex, perhaps you come into some money or reach retirement with a corporate pension to sort out, sitting down with someone who really knows their subject can add enormous value.

You'll learn how to work out exactly what you want an adviser to do. Brett Davidson highlights two main areas where a good adviser helps. The first is technical expertise, getting in front of someone who genuinely understands the ins and outs of your situation. But the greater value, he argues, comes from an adviser who asks interesting questions about your values, beliefs and what you want to do with your life. Finding the meaning in your money is where the real magic lies.

You'll also learn where to start your search. Asking friends, family and colleagues is a good beginning, as is tapping your existing professional network of accountants and lawyers for recommendations. But once you're in front of a potential adviser, the key thing to watch for is the quality of their questions. An adviser who has clearly thought about how they challenge and provoke your thinking is likely to add far more value than one who simply talks at you.

The takeaway: financial advice isn't a one-off transaction. The adviser you choose should be someone you're genuinely happy to build a long-term working relationship with, because the best financial planning is a partnership that develops over many years.

Chapters / Key points

• Why choosing the right financial adviser is such a challenge
• Whether you actually need a financial adviser at all
• When financial complexity makes advice worthwhile
• Working out exactly what you want an adviser to do
• The two main ways advisers add value: technical and personal
• Why finding the meaning in your money is where the magic lies
• Where to start looking, from friends and family to your professional network
• Why the quality of an adviser's questions matters most
• Why financial advice is a long-term relationship, not a one-off

Transcript

How to find a financial adviser

RP: Hello there. With so many financial advisers to choose from, finding the one who's right for you is quite a challenge.

Brett Davidson runs a consultancy called FP Advance, which helps advice firms to advise their clients better. I started by putting it to him that not everyone needs a financial adviser.

BD: I think that's fair, I think some people don't. You know, if there's not much there to be dealing with, the simple things are: pay off your mortgage and get your kids through school. Most people, I think, would be happy to do that. But if there's a bit more floating around, or you come into some money, or you get to that retirement phase and you've got your corporate pension coming through, the world is so complex today that to get in front of someone who really knows their onions, I think, can add a lot of value.

RP: When choosing an adviser, it's important to know exactly what it is you want them to do. So, what are the most important ways in which an adviser can help you?

BD: I think, broadly speaking, there's a couple of areas. One is the technical, so getting in front of a person who really knows the ins and outs of your issue is always really valuable. But I think the biggest stuff, where advisers add value, is by asking you interesting questions about your values, your beliefs, the things you want to do with your life, because it's finding the meaning in the money that is the real magic, I think, from a good adviser.

RP: OK, you now know what you're looking for. What does Brett suggest you do next?

BD: Asking around friends, family, colleagues is a good place to start. Your professional advisers, accountants, lawyers, who do they know? But once you get in front of someone, the thing I'd be looking for is, "Do they ask interesting questions?" Because a person who's bothered to think about the quality of the questions that they ask you, someone who challenges and provokes your thinking, I think can add a lot of value.

RP: Finally, financial advice isn't a one-hit solution. So remember, the adviser you choose must be someone you're happy to have a long-term working relationship with.