The financial advisor environment in New Zealand is somewhat misunderstood, so here are some facts you need to know.
Most financial advisor clients in New Zealand tend to be at least 40 years old with money to invest. The younger ones’ primary investment options are more inclined to KiwiSaver contributions, buying a house, and investing in managed funds or bank products.
A financial advisor’s services can cost you money — is it worth it?
Financial advisors are professionals who advise on financial planning, insurance, investing, and other financial services. They can help you make the right decision on what products and investments are best for you.
A financial advisor is qualified and usually a member of Financial Advice New Zealand or similar professional organisations.
While other financial advisors have a wide range of products, some have a limited number of products from product providers when they recommend financial advice.
Before the process starts, ask the financial advisor about the variety of the range of products and providers they consider when giving advice.
Financial products can be complicated. A financial advisor can help if you’re considering to invest and need advice with what you’re looking for. They can provide guidance for the following:
- Financial planning
- Investments and retirement plan — managed funds and investment trusts
- Insurance — personal and business insurance
- KiwiSaver — select the right provider, contribution consultation, and switching to a more suitable scheme.
The first consultation with the potential client is at no charge. Very few financial advisors charge an upfront fee.
Usually, financial advisors work on commission and get paid depending on what you invest. Say, you invest $100,000, your advisor will be paid around $250 – $500 annually by the investment platform you select — representing a 0.25% – 0.50% commission.
Note: The financial advisor can select the right product for your circumstances, although, you may not be advised on the most cost-effective investment available in the market.
If you think you’ve been incorrectly advised, you have a right to complain. You can discuss with your advisor first why you think it was wrong. Support your argument with as much paperwork and emails as you can collect.
Example: If you were advised that a product you invested in could not lose money, and then you did.
You’ve probably heard the term beneficiary loans before. If you need money quicker than you’re receiving benefits, then a beneficiary loan is for you.
After you apply for a loan online, you’ll know the outcome within a matter of minutes, at which point, a PPL customer service rep will send you a friendly email with a few forms to sign.