By Robyn Laubscher, Advice and Product Specialist, PSG Wealth

Building a trusted relationship with your financial adviser is key to achieving your financial goals. The intention should be to forge a relationship that is life long and continues through generations. To make the most of the services a financial adviser provides, it’s important to work with someone who is the right fit for you – and that starts by asking the right questions.

Work with someone you trust

Trust is the cornerstone of any successful financial planning relationship, and your adviser should take the time to listen, understand your personal goals, and provide guidance that aligns with your specific financial situation. Equally important is that you, as the client, fully understand the advice being given. Don’t hesitate to ask questions – continue the conversation until you feel confident and comfortable with the recommendations being made.

I would encourage you to include your spouse and older children in these conversations, as it is important for everyone in the family to understand the key elements of financial planning and to build a relationship with your adviser.

What you should ask your financial adviser

To help you decide whether an adviser is a good fit for your needs, consider asking questions covering the areas outlined below.

About the adviser

Ask your adviser about their qualifications and the designations they hold. Ideally, they should hold a postgraduate diploma in financial planning and be a certified financial planner – indicated by them carrying the CFP^® designation. Also enquire about how many years of experience they have in providing financial advice.

Services offered

Ask about the services they provide. Do they offer comprehensive financial planning or investment management only? Find out if they will provide you with a written financial plan.

Fees and compensation

Clarify how the adviser is compensated – whether through fee only, commissions or a combination of both. Ask for a breakdown of your total fees, including fund and platform charges, and find out whether they receive any commissions or incentives from any third parties, such as product providers.

Investment approach

Discuss how the adviser develops investment strategies for clients and how they assess risk tolerance and time horizons. Find out what types of investments they typically recommend, and why. In addition, ask about how often your portfolio will be reviewed.

Trust and transparency

Find out how often you can expect to meet and how often the adviser will communicate with you. Ask if you will receive regular reports and performance updates that are easy to understand and whether they can provide testimonials or references from existing clients.

Risk management and protection

Ask the adviser how they manage and mitigate investment risk and enquire about the safeguards they have in place to protect your capital during times of market volatility.

Regulation and compliance

Check that the adviser is licensed and regulated by the Financial Sector Conduct Authority (FSCA) and understand the steps you should follow if you have a concern or complaint.

Flexibility

Find out how easily your investment plan can be adjusted. Ask if there are penalties or exit fees if you decide to end the relationship.

Succession

Find out who the adviser works with, and in the event something unexpected happens to him/her, who will be his/her successor?

Take the initiative

By being selective about the financial adviser you choose to partner with, you can rest assured that your hard-earned money is being managed by someone you can trust and who will walk with you every step of the way on your financial journey.