The first time you see a financial adviser, expect to be asked a lot of questions about your life, your goals and what’s really important to you before the conversation gets to your finances. There shouldn’t be any talk of products or solutions in that first meeting, and you’re under no obligation to go any further.

Wednesday 7 October is World Financial Planning Day, now in its tenth year. Plenty of people need financial planning and either can’t access it or don’t know who to talk to, and if you’ve never seen an adviser before it’s hard to know what to look for.

What to Expect Before and During the First Meeting

An adviser should send you a disclosure statement before you’ve met. It shows they’re a legitimate, registered financial adviser, tells you a bit about their history, explains how their fees work and sets out any conflicts of interest.

Some advisers will send you something about how working with them will go as well. At DecisionMakers we have a document called Before We Get Started, which covers who we are, how we work and what the process will be like, so it isn’t a mystery.

The adviser should spend the first part of the meeting getting a good understanding of you before moving on to your finances, where the biggest part is your income and your expenses. They will then go away, compile everything you’ve talked about and put together a plan for you.

An adviser obviously needs to be paid, but that shouldn’t be the focus right at the very beginning. The first hour with me is always free, which is there to lower the barrier to entry.

Two Questions to Ask a Financial Adviser

Ask how the adviser is paid, and ask whether they’re linked or connected to any particular fund manager. A link like that can affect which funds they recommend for your portfolio. An adviser who is being paid by a fund manager may be under more of an obligation to include certain funds, and some advisers only work for one fund manager, so all of your funds will come from that manager. Independence is a really important thing to ask about.

How Do You Know If an Adviser Is the Right Fit?

Look for someone who feels like they genuinely care about you as a person. Everyone connects with different personalities, so an adviser might be doing their job exactly as they should and still not be the right one for you. The first adviser you see doesn’t have to be the one you work with, and you should be wary of anyone who seems really focused on selling you a particular product in the first meeting.

Advisers look after different market segments. Some people are put off because they think you need a million dollars to see someone, and for some advisers you legitimately do. An adviser who cares about you should be able to point you towards someone more suitable if they aren’t the right fit.

The Takeaway

Check that you’ve been sent a disclosure statement before a first meeting, and expect the conversation to be about you and your situation. Ask how the adviser is paid and whether they’re tied to a fund manager, and remember that you’re free to see someone else if it doesn’t feel right.

If you’d like to talk through your own situation, get in touch with me for a free, no-obligation hour at dave @decisionmakers.co.nz.

Frequently Asked Questions

What questions should I ask a financial adviser? Ask how they are paid, and whether they are linked or connected to any particular fund manager. A link to a fund manager can affect which funds they recommend for your portfolio.

Do I have to pay for a first meeting with a financial adviser? With Dave at DecisionMakers, the first hour is always free. An adviser does need to be paid, but that shouldn’t be the focus at the very beginning.

What is a disclosure statement? It’s a document an adviser sends you before you meet. It shows they’re a legitimate, registered financial adviser and covers their history, how their fees work and any conflicts of interest.

What are the warning signs when meeting a financial adviser? Be wary of someone who seems really focused on selling you a particular product in the first meeting. A good first meeting has no talk of products or solutions at all.