What is financial advice?

Financial advice is the process of developing strategies to help you manage your financial affairs so you can build wealth, enjoy life and achieve financial security.

Now more than ever, New Zealanders need good financial advice.  Good financial advice helps you make the most of what you have while helping you create a comfortable future for you and your family.

A financial adviser can help you make financial decisions to give you peace of mind, because good advice is money well spent.

Financial Advisers like all professions have generalists and specialists.  The areas they advise on traditionally have been:

  • Insurance and Risk Management Advisers
  • Investments, Savings and Wealth Management Advisers
  • Financial Planners providing overview and advice on Savings and Risk in many instances the solution  products or referring clients to a specialist adviser colleague 

Their specialisation now includes and extends to Lending and Debt, Wills and Estate Planning, Retirement Planning and much more.  When working with an adviser it is important to determine their skill and strength area and who they refer clients to.

Some people may think that financial advisers only give advice on investments. This is not true.  The role of a qualified financial adviser is to look at all aspects of your lifestyle, goals and requirements and develop a financial strategy suitable for you.  The recommended strategy should help you reach your financial goals effectively and efficiently.

Advice falls into two areas: general or personal.

General advice is on financial products but does not take into account your personal circumstances.

Personal advice takes into consideration your personal objectives, financial situation and needs.

Specific areas you wish to address or look at (or get an opinion on).  These may include such things as:

-     Financing (mortgages, debts, hire purchase, credit cards)
-     Investments and/or savings
-     Retirement planning
-     Estate planning (Wills, Powers of Attorney, trusts, ownership structures)
-     Insurances (life, income protection, trauma, medical)

The six-step financial advice process

When developing a financial plan for you, known as a Statement of Advice, a financial planner will follow a structured process to help you understand your needs and recommend an appropriate strategy.  The six-step financial planning process is as follows:

  1. Gather your financial information

  2. Identify your goals

  3. Identify your present financial situation, potential problems and opportunities.

  4. Prepare your financial plan (called a Statement of Advice) that recommends strategies to meet your needs and goals.

  5. Implement the recommendations based on your financial plan.

  6. Review and revise the plan at regular intervals, or when circumstances change.

Want to know more?

Find a Financial Adviser near you.