For professional investment advice, you need a financial adviser.
Advice on investments is widely available. Sharebrokers, commentators and other investors are more than happy to tell us where to invest and what to invest in – especially when they’re selling us something. But sometimes it’s hard to tell if we’re being told or sold!
Financial advisers can specialise in investment, KiwiSaver and planning. An adviser is a qualified expert who can:
A financial adviser will be qualified to advise you on specific things – they will tell you what they can and can’t advise you about. For example, an expert on life insurance can’t give you advice on KiwiSaver. Some will specialise in more than one area, which can be helpful.
It’s okay to work with different advisers for different things, such as an adviser for your mortgage, one for your investments, and another for your long-term planning.
Not just anyone can call themselves a financial adviser. They have to meet a certain standard of competence and treat you ethically. They need to put your interests first and:
It helps to shop around for the right financial adviser for you before you decide which one to work with. We recommend you talk to at least three. Look for the right fit. This includes the way they communicate, relate and understand your situation.
Anyone providing financial advice professionally needs to be licensed by the Financial Markets Authority. All financial advisers must either hold a licence themselves or work for someone else with one. They need to be registered as a financial adviser and tell you the name of the licence holder they work for.
Here's how to find a financial adviser who specialises in investment.
The FMA website has some some good tips to consider when choosing an adviser and more about knowing your investments.
Most financial advisers are paid by a company (like a KiwiSaver provider) to sell their products, which is common practice. Financial advisers are required to tell you about any commissions or bonuses they get. Feel free to ask.
When they are paid by a company to sell, the adviser has a conflict of interest. They might, for example, be more focused on selling and less on whether what they’re selling is right for you. When there is a conflict though, financial advisers are required to tell you up front and put your interests above theirs.
Financial advisers are accountable for their actions. If for some reason you have concerns about an adviser and how they treated you, you have the right to make a complaint.
Every financial adviser belongs to a dispute resolution scheme – a service that can look into whatever went wrong at no cost to you. The scheme makes sure you’re treated fairly.
If you feel an adviser is not behaving professionally or not putting your interests first, you can also complain directly to the FMA.
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