What is a Financial Adviser and When Do I Need One? A Guide for all Australians

Managing your finances can feel overwhelming, especially as life becomes more complex with significant milestones like buying a home, saving for retirement, planning for a child’s education or even considering aged care for parents.

While many people handle their finances on their own, there are times when expert advice can make a world of difference. This is where a financial adviser comes in.

In this blog, we’ll explore what a financial adviser is, how they can help you make smarter financial decisions, and when you might need one.

At Gild Wealth, we believe that making informed financial choices is the key to achieving long-term financial security, and we’re here to help you understand when to turn to a financial expert.

What is a Financial Adviser?

A financial adviser is a qualified professional who provides expert advice and guidance on how to manage your money and investments.

Their role is to help you make informed decisions about your finances, whether you’re focused on budgeting, investing, saving for retirement, or managing debt.

Financial advisers can help individuals, families, and businesses by providing strategic advice tailored to their specific goals and financial circumstances.

Depending on their area of expertise, they may assist with:

• Utilisation of cashflow: Helping you utilise your cashflow and work towards long term saving plan that aligns with your goals.
• Investing: Advising on investment strategies, whether in shares, bonds, real estate, or other assets.
• Retirement planning: Guiding you on how much to save for retirement, which superannuation funds to use, and the best strategies to grow your retirement savings.
• Aged care: Guiding you on decisions and funding options for your own or your family members’ move to aged care.
• Tax strategies: Helping you minimise your tax liabilities through effective planning.
• Insurance: Recommending life, health, or income protection insurance to ensure you’re financially protected.
• Estate planning: Advising on how to structure your finances and assets for a smooth transfer to beneficiaries.

Financial advisers in Australia must be registered with the Australian Securities and Investments Commission (ASIC) and adhere the Financial Planners and Advisers Code of Ethics (2019).

Many financial advisers also hold professional qualifications such as Certified Financial Planner (CFP) or Chartered Financial Analyst (CFA).

What Does a Financial Adviser Do?

A financial adviser works closely with you to understand your financial goals and challenges, offering personalised advice that takes your current situation into account.

Their responsibilities can include:

• Creating a tailored financial plan: This plan outlines your financial objectives and provides a clear strategy to achieve them, whether it’s saving for a home deposit, paying off debt, or planning for retirement.
• Investment management: Advising on the right investment strategy based on your risk tolerance, time horizon, and financial goals. They may help you select individual shares, bonds, managed funds, or other investment vehicles.
• Superannuation advice: Helping you understand your superannuation options, optimize your contributions, and ensure you’re taking full advantage of any government incentives or tax benefits.
• Tax optimisation: Offering strategies to help you reduce your tax burden, whether by structuring your investments efficiently, utilising tax-effective products, or making concessional superannuation contributions.
• Insurance and risk management: Ensuring you’re adequately covered by recommending insurance products that protect your income, health, and assets.
• Retirement planning: Helping you save for retirement and develop strategies for managing your finances once you’ve retired, including how to draw down on your superannuation or other savings.
• Aged Care: Navigating the complex rules and funding for individuals when their/your care requirements increase.

When Do You Need a Financial Adviser?

While some individuals prefer to manage their finances on their own, there are several key moments when seeking professional financial advice can be extremely beneficial. Here are a few scenarios when you might need to consider working with a financial adviser:

1. You’re Facing Complex Financial Decisions

As your financial situation becomes more complex—whether due to changes in income, assets, or obligations—a financial adviser can provide clarity. For example, if you’re considering making large investments, taking out a loan, or starting a business, the adviser can help you understand how these decisions will impact your financial future.

Complex decisions also arise in scenarios like buying property, investing in the stock market, or managing a significant inheritance. If you’re unsure about the best financial approach in these situations, a financial adviser can offer guidance tailored to your unique situation.

2. You’re Saving for Retirement

Planning for retirement is one of the most important financial goals you can set. If you’re not sure how much to save, which superannuation funds to choose, or how to manage your assets to ensure you have enough for your retirement years, a financial adviser can help you create a plan.

They can assist with strategies like salary sacrificing into super, choosing the right investment mix, and understanding how the government’s age pension might fit into your retirement strategy. They’ll also help you estimate how much you need to retire comfortably and guide you on how to meet those targets.

3. You Have Major Life Changes

Life events such as getting married, having children, starting a business, buying a home, or going through a divorce can significantly impact your finances. During these times, a financial adviser can help you adjust your financial plan, set new goals, and ensure that your insurance and investments align with your changing needs.

For instance, if you’re getting married, you might need to review your joint finances, set up a budget, and explore insurance or estate planning options. If you’re having a baby, you might want to consider additional life or income protection insurance or saving for your child’s future education.

4. You Want to Minimise Tax or Maximise Wealth

If you’re in a higher tax bracket, you may want to explore ways to minimise your tax burden. Financial advisers can help you with tax-effective investment strategies, using superannuation to your advantage, or structuring your assets in a way that reduces your taxable income.

If you want to maximise your wealth over the long term, advisers can assist with diversifying your investments, choosing the right assets for your risk profile, and ensuring that your portfolio aligns with your financial goals.

5. You’re Overwhelmed by Financial Decisions

Some people find that managing their finances is time-consuming or overwhelming, particularly when there are a lot of decisions to make, or they don’t feel confident in their financial knowledge. A financial adviser can step in, handle the legwork, and provide you with clear recommendations and strategies.

If you simply don’t have the time or energy to focus on managing your money effectively, a financial adviser can take on the responsibility of creating a financial plan, managing your investments, and ensuring you’re on track to achieve your financial goals.

6. You’re Looking for Ongoing Financial Guidance

Even if you don’t have any immediate financial concerns, it can be beneficial to work with a financial adviser for ongoing financial guidance. Regular reviews with an adviser ensure that your financial strategy remains aligned with your goals and the ever-changing economic environment.

For example, a financial adviser can help you adjust your strategy if there are changes in tax laws, interest rates, or investment opportunities. They can also provide regular performance reviews of your investment portfolio to ensure it continues to meet your financial objectives.

How to Choose the Right Financial Adviser for You

If you’ve decided that you need a financial adviser, it’s important to choose someone who aligns with your needs, values, and financial goals. Here are a few things to consider when selecting an adviser:

• Qualifications and credentials: Look for a financial adviser who holds relevant qualifications and is registered with ASIC.
• Experience: Choose someone who has experience working with clients in similar financial situations to yours.
• Fee structure: Be sure you understand how the adviser charges for their services—whether it’s a flat fee, hourly rate, or percentage of assets under management.
• Compatibility: Make sure you feel comfortable discussing your finances with the adviser and that they understand your goals.

Conclusion: The Value of Financial Advice

Financial advisers can play a pivotal role in helping you manage your wealth, plan for the future, and make smarter financial decisions.

Whether you’re dealing with complex financial choices, planning for retirement, or simply need expert guidance, a qualified adviser can help you navigate the intricacies of personal finance.

At Gild Wealth, we specialize in providing tailored financial advice, whether you’re starting out on your financial journey or looking to fine-tune your existing strategy. If you’re ready to take control of your financial future, contact us to schedule a consultation.