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What is goals based financial advice?

Goals based advice is a term coined quite a lot these days, you could argue it’s a bit of a buzz word or phrase, but what does it really mean? In short, goals-based advice is achieved by your financial adviser putting your goals, hopes and dreams for the future at the forefront of everything they do when building your strategy. Like many industry's it's about putting the client at the centre of everything.  

This is not a new phenomenon, it is something we at Hewison Private Wealth have been providing our clients with for many, many years. It involves meeting with clients and allowing them to share what is truly important to them in the short, medium and long term. 

While the industry may strive to provide goals-based advice, unfortunately, it was found wanting during the Royal Commission.  It was highlighted how many consumers felt the advice they received was not always linked to their individual goals and objectives, but rather to investment products and sales. 

How can you be sure your adviser is providing true goals- based advice? Here are three things to look out for: 

Is the conversation centred on you? 

To provide goals-based advice an Adviser needs to understand what you are trying to achieve. It may be as simple as saving for a home deposit or a longer-term goal of accumulating/preserving wealth for retirement.  

These goals cannot be ascertained from a risk-profiling questionnaire or data collection form, rather from a detailed conversation with your adviser about your current situation, your needs and wants and most importantly, your goals and objectives. 

You need to be sure that your adviser is working for you and not leading you into a specific investment product based on what they think you want to achieve. 

Can you sleep at night? 

The ‘sleep-at-night factor’ is an important part of providing goals-based advice. You need to be comfortable with your financial strategy and understand the pros and cons of each step you take. If your Adviser is bamboozling you with rates of return, risk metrics, compound earnings and/or commissions then perhaps you need to take a step back and assess whether they are providing the advice you truly need. 

Is the advice you receive independent? 

Independent advice firms exist to provide clients with independent, unbiased advice. This gives the advantage of offering a range of product and investments to achieve your goals and objectives – not line the pockets of the big product manufacturers. 

Using goals-based advice is not rocket science. Hewison Private Wealth has been providing clients with goals-based advice for the past thirty years. We pride ourselves on establishing long term relationships with clients and partnering to achieve your goals and objectives. How refreshing!  

 

Hewison Private Wealth is a Melbourne based independent financial planning firm. Our financial advisers are highly qualified wealth managers and specialise in self managed super funds (SMSF), financial planning, retirement planning advice and investment portfolio management. If you would like to speak to a financial adviser on how you can secure your financial future please contact us 03 8548 4800, email info@hewison.com.au or visit www.hewison.com.au

Please note: The advice provided above is general information only and individuals should seek specialised advice from a qualified financial advisor. The views in this blog are those of the individual and may not represent the general opinion of the firm. Please contact Hewison Private Wealth for more information.