As people from the southern states flock to the beautiful Sunshine State, the people of Brisbane need to ensure their assets are protected and in the best place to capitalise on the market growth.

From skyrocketing property prices, through to real estate investment trusts (REIT) geared to capitalise on the current growth, are your personal finances to maximise your returns in your retirement?

Financial planning is your roadmap to success

Ever wondered why some people are retiring comfortably up on the Sunshine Coast, Fraser Coast or Gold Coast beaches? Financial planning has more than likely quite a lot to do with it.

Seeking professional financial planning advice sooner rather than later can literally save you tens of thousands, if not hundreds of thousands during your retirement, not to mention providing more money to enjoy now – fun in the Brisbane sun!

Why see a professional planner now? Why not when I am closer to retirement?

It is a myth that a financial planner is something that you need when you are coming up to retirement. In fact, a Brisbane financial planner can provide you with the necessary advice, roadmap and goal setting that could open your eyes to so much more.

Thinking of an investment property? Maybe an annual holiday overseas with the family? What about a jet ski to punch over to Straddie? Well, rather than buying these on credit, or leveraging assets just because your bank manager says it’s a good idea, why not have an expert take a look?

A financial planner looks not only at the now, but the future, and everything in between. You wouldn’t get in the car without knowing where you were going, and your financial map is no different. Like your GPS, a financial planner in Brisbane can provide you with several ways to get to your destination, different risk levels, varying investment options, not to mention regular passive income streams to top up your annual salary!

Wouldn’t it be nice to have an extra $1000, $10,000, or even $50,000 a year? A financial planner can show you how.

But don’t be fooled, a financial planner will also give you the hard truth about your financial situation, your credit score, your debt levels, and your retirement plans.

How does a financial planner work?

The great thing about most financial planners around Brisbane, is they come to you. They meet and discuss your personal finances. This includes insurance, superannuation, investments, mortgages, credit cards & debt levels, wills & estate planning just to name a few areas.

They will also work through your earning capacity, your life situation (married, children, single etc), the number of years you have left to realistically work in your job at full capacity – and then build out that roadmap, just for you.

Then on a regular basis, your financial planner can come to your Brisbane home, or one of the great cafés around the River City, and discuss your progress, make changes if necessary but all in line with meeting the goals and expectations you set out in your initial meeting.

Financial planning is not just for wealthy people, it is a profession that aims to create wealth for its clients. Not simply financial wealth, but the wealth of the shared experiences that you and your family can enjoy but knowing your (and your family) financial future is in safe hands.

As the most isolated capital city in the world, Perth residents have long enjoyed the fruits of the mining boom, the picturesque beaches and a lifestyle that is arguably the envy of much of Australia. However, Perth has also experienced the economic highs, and desperate lows due to its reliance on what it pulls out of the ground, with fluctuating house prices, cost of living, not to mention job securing often tied to Global Iron Ore and other precious mineral pricing.

In the 2017 ABC Documentary, Betting on the House, it was evident to viewers how unguided, inexperienced investment in the property market brought many people in WA to their knees.

With similar market hallmarks in the Western Australian’s mining industry – in part due to the trade war with China and the downward pressure on iron ore pricing & jobs – it’s timely to consider could a GFC-like effect impact the WA market?

Prepare for the unexpected

Financial Planners in Perth understand the risks of FIFO workers, the rewards and the opportunities that are out there for investors that put their money in the right place.

A financial planner can provide a path to success for your personal finances, regardless of if you earn a lot now, later or lose your job through industry cutbacks.

In a market such as Perth that has already seen the highs and lows, pooling your investments in one asset class such as shares or property has proved to be extremely dangerous – and for your long-term financial security, a Perth financial planner is key to getting this right for you.

Regardless of how old you are, have you got a will? Have your thought about how much you would need to retire? Have you through about purchasing a boat? Or have you seen a little apartment you liked in Broome that would be a great holiday rental, as well as a place for you to get away from the world? A financial planner based in Perth is the ideal piece of the puzzle for those looking to ensure their financial future is in good hands.

I understand money, why should I see a financial planner?

What happens if the mining ends? If you work in hospitality or tourism and run into issues, could you survive if it couldn’t get back up on its feet? What if you lost your job? Could you pay your mortgage?

A financial planner is not a ‘dooms-day prepper’, but a planner for all scenarios you might face in your future. They look at your life, objectively, working through what levels of debt you have, what income you make, how many years you could work and how much you need to retire.

But it’s not all about squirrelling away all your money and having no fun. What about a small boat to enjoy Rottnest Island? Why not. But too many people make the mistake of putting them on credit, not planning, saving and buying when the time is right.

If you want to be comfortable in retirement, get debt-free, and own your financial future – not be a slave to the big banks and their interest payments – then a financial planner in Perth is your next best step.

Weigh the situation, then move – Sun Tzu

Your financial journey is now in your hands. This Walker Capital eBook has provided you with the details of the product, price, place, people and processes of financial planning – now it’s up to you to make it happen.

The next steps are to look inwards, review your current financial situation, download an excel spreadsheet template of a personal budget – if you don’t already have one – and start getting prepared to meet with a financial planner.

Speak to your friends, accountant, lawyer and see if there are any names that come up more than once. The key is don’t just to run to the biggest name in town, they will often have a standardised offering, non-flexible pricing and mediocre returns.

There are many financial planners out there, but the key is to find the one best suited to you, your family and your financial needs and risk tolerance – remember, you are the client, it is your call.

Walker Capital are an established financial investment, fund manager and financial services company based all around Australia.

With a dedicated financial planning network expanding exponentially, Walker Capital have independent advisors, with objective thinking. Being part of a national network means Walker Capital get access to the best investment opportunities across a wide range of classes.

Being a vertically integrated business there are internal & external opportunities that are available to clients, while also never creating a fund or a product without themselves investing or using it – a mark of faith in a product if there ever was one.

Your financial journey should be that of a learning, growing and rewarding experience, pick the financial planner who shares your vision, understands your goals and objectives and, most importantly, understands you.

Congratulations today is your day, your off to great places your off on your way – Dr. Seuss

Sometimes things go sideways, advice is provided that leads to money being lost either on a small scale or potentially a life altering scale.

For example, you may get advice to invest your savings into a fund, so you put your retirement nest egg or part of it into a short-term vehicle on your financial planner’s recommendation – and it goes bust, you lose the lot. This has happened in Australia, Storm Financial, then insurance provider HIH, which went under leaving many Australian’s not able to claim on their insurance, nor their assets insured at all.

So, it does happen, albeit not regularly so there are mechanisms for both large and small grievances you may have against your financial planner. Wanting to take your planner to court because they said, ‘you could make 20% on your investment’ and you only make 15% will be struck out before you even get there. However, where real losses are incurred, improprieties are perpetrated or you feel your planner has behaved unethically, then there is certainly recourse.

Working out a mutually beneficial solution with your planner

As with most situations, the first step is to air your grievance with your financial planner and see if there is a mutually beneficial outcome. If they have done everything, they can iterate your plan, worked to reinvest to make money back and you are on track, then we would recommend that you collaboratively work with them – rather than against them. However, if the matter is unable to be satisfactorily be resolved, then you have several other places to go.

Financial Planners Association

By working through planners that are registered with an industry body or association, they not only have to adhere to standards of ethics, development and expertise, but they also are subject to the rules and regulations of the respected body.

For example, should you have a grievance, you can speak with members of the association and lodge a complaint, enter into mediation, or potentially have them investigate your matter in an effort to seek a resolution. This will be a much cheaper option than bringing in lawyers and starting legal proceedings. However, if you are not getting a satisfactory outcome, then you can then escalate the matter to the Financial Services Ombudsman.

Financial Services Ombudsman

The Financial Services Ombudsman (FSO) is there to protect consumers rights, and to hold industry participants to account. Although taking your case to the FOS will be cheaper but can be more time consuming and there is a $280,000 cap on compensation.^[1] As such, you need to review at this stage – with a lawyer – what the implications of taking the practitioner to court are, if your claim + damages exceed the cap on compensation, then you may wish to proceed further and take them to court.

However, it should be noted, that often in this case, the legal fees eat significantly into any settlement that may be achieved, and if your financial planner or advisor goes bankrupt in the process, you may be left with very little.

The Australian Financial Complaints Authority provides live chat, online and phone access to people dedicated to assist you with your compliant, and work towards a resolution for you as a consumer of financial services.

[1] https://www.mauriceblackburn.com.au/blog/2016/july/11/bad-financial-advice-how-you-can-fight-back/

As we have clearly outlined throughout this Walker Capital eBook, the risks (and costs) of not working with a financial planner are far greater than that of working with one.

The missed opportunities, how as little as $100 per month into a managed account could one day give you a $280,000+ nest egg, or how much you could benefit from a self-managed superannuation fund (SMSF), changing your insurance providers or investing into a fund.

Like almost everything in life, there are most certainly risks being aware of with working with a financial planner.

Investment Losses

No one likes to lose, but that is a fact of the financial markets – which people call efficient for just that reason, some people win, and some people lose.

However, one of the risks of working with a financial planner, is just that. You invest your money into a portfolio, fund, property, shares or other alternative investment vehicle and it loses value.

Spare a thought for people who invested in cryptocurrencies like Bitcoin, put their SMSF money into it, when it seemed it could climb to astronomical heights – only for it to fall from over $86,179.29 to $45,780,98[1] as at the writing of this article.

That is a loss of over $40,000 in just a matter of months, or 46% of your total investment! Sure, some lucky people bought these coins for under $1 and are enjoying the spoils – but they are speculative. For more information on Alternative investments, please see the Walker Capital Alternative Investments eBook.

So, back to your potential risk of investment losses while working with a financial planner. As the client, you need to be very clear on how high your risk tolerance is, how much you want to diversify your portfolio and the types of investments you are prepared to make.

Irrespective of how safe a company may look, or how solid an investment may look, there are always externalities such as macro-environmental factors that are well outside your control – such as the GFC in 2008 and COVID-19 in 2019-2021 that may incur losses to your portfolio – so be warned.

Clinging to failed strategies

As Kenny Rodgers in the classic tune The Gambler said, “you need to know when to hold them, know when to fold them”. Although he was refereeing to cards in a card game – your investment portfolio in this respect is no different.

You and your financial planner need to have a candid conversation when it becomes apparent that failed strategies have been implemented and losses have been incurred by your portfolio.

Clinging to failed strategies is risky business, hoping they may turn around. For example, investment in property funds, in which the fund manager keeps saying “The development is coming, we are just waiting for some more capital”, despite your prospectus document stating the building should have been paying you annual returns for the past 2 years, and in fact, the building should have been constructed by now!

There are signs outside of simply losing money when it comes to your investments, where you should cut your losses and move one. And although a bitter pill to swallow, you as the client need to be strong and do so.

Life Event Risk

There are only three sure things in life, birth, death and taxes. As such, as an investor, trader, planner or simply a person wanting to set themselves up, you need to be prepared – life happens.

This is not always a negative risk to your portfolio, despite being at a great personal detriment, you may experience a financial windfall when a parent or loved one passes and this needs to be factored into your portfolio.

But you also may have started out your financial journey as a single working person, got married, had children and so on. As your life progressed, you may like one third of Australians get divorced, then remarried, and create a new family. So, in essence, life happens, and it is important to be prepared.

There are many risks with anything financial, but the greatest risk is to push through life, only thinking of the weekend, the here and now, then to get to the end of your working life with no nest egg, a mortgage and no passive investments to supplement your income when you wish to slow down.

Plan to succeed, and even if you encounter the above-mentioned risks, you and your financial planner have the skills, expertise and options to set a new plan in place and move forward.

[1] https://www.coindesk.com/price/bitcoin viewed at 1.28pm 30.06.2021

Unless you were sleeping under a rock and haven’t read any of the previous chapters of the Walker Capital eBook into Financial Planning, you would have heard about the into Misconduct in the Banking, Superannuation and Financial Services Sector.

The findings were damning, and the whole sector has gone through an overhaul to regain the trust of their customers – including in some cases paying back large sums of fees and fines that were changed indiscriminately and unlawfully.

According to KPMG, “this report will drive significant transformation in financial institutions including operating models, product design, customer interaction, governance, remuneration and risk management. Businesses impacted include banks, mortgage brokers, wealth managers, insurers, superannuation funds and financial advisors.

The Commission’s work has four clear observations:

• the connection between conduct and reward
• the asymmetry of power and information between financial services entities and their customers
• the effect of conflicts between duty and interest
• holding entities to account.”[1]

As a client of financial planning (financial service), you could be excused for wondering “How this may directly affect you?”.

For a specific review, the Australian Treasury released a table with the recommendations of the Royal Commission, and the effective response they issued to move forward – Restoring Trust in Australia’s Financial System.

In summary, though the Royal Commission provided the following changes to your financial planner, the Commissioner’s recommendations, while expected, bring significant disruption to and accelerate necessary changes to business models, specifically:

• Removing grandfathered conflicted remuneration
• The suggestion that life insurance commissions be reduced to zero
• Requiring annual consent to fees.
• Higher training requirements
• New reporting obligations and controls
• A significant uplift in internal compliance.
• A new disciplinary body to bring financial advisers into line with other professions. 
• Compulsory training and a new Code of Ethics
• Reporting compliance concerns.
• Organisations will have a responsibility to ensure rigorous recruitment and reference-checking processes for advisers seeking to operate under their licence.^[2]

These ten points are only the beginning of the changes in compliance, reporting, regulation, fee structures and services that directly affect your financial planners, the organisations they work for and the services they provide. As such, it provides you as a consumer of financial service far more clarity, more convenience and more safeguards to know that you are protected – as you should be.

As we have mentioned earlier, it is important to do your due diligence into your financial planner – or any professional services provider for that matter.

To get a feel for potential planners, review their website, ask for phone numbers of several clients to discuss their ongoing experience and get a feeling for whether the planner is a good fit. In addition, have your lawyer and accountant investigate your new adviser – just to get a feeling about them.

This is no different to an interview process that you may go through to get employment, and your financial planner is no different – they are being interviewed for a long-term position within your network of consultants.

Finally, you need to do some reading, get an understanding of what they need to provide, how they need to provide it and what they need to provide to you. The governments Restoring Trust in Australia’s Financial System is a great place to start, as are the FPA and AFA websites.

[1] https://home.kpmg/au/en/home/insights/2019/02/financial-services-royal-commission.html

[2] https://www.ey.com/en_au/financial-services/how-the-royal-commission-impacts-the-financial-services-industry

Choosing your financial planner is important, as they will more than likely be a ‘long term partner’ to you and your financial progress (or journey) from where you are now through to your retirement.

There is a range of common mistakes that people make when seeking advice, and these should be known prior, during and after your engagements, to ensure you are getting the very best advice.

Coming unprepared

One of the most important elements to get the ‘right financial advice’ is to come prepared. Technology today is something that can support you in doing so, setting up a Dropbox or Google Drive and getting all your files ready for your meetings.

Files to get prepared are:

1. Bank statements – ensuring you have the last 3 to 6-months of your banking statements done.
2. Credit Card Statements – same as the above, it is important that despite how large or small your debt may be, you have them in the file.
3. Loan statements – car loans, business loans, personal loans, Buy-now-pay-later account (Afterpay/ZipPay) statements.
4. Superannuation statements
5. Insurance statements
6. Shareholding or investment statements
7. A list of goals and objectives – short, medium and long term.
8. Any other documentation that you feel is important and may have a bearing on your financial decisions now or in the future.

Although this may seem like an exhaustive list, it may indeed seem excessive, the more you have available, the better the outcome for you and your financial planner will be. Why? Because they have all the information, and they are not asking you to come back to them with additional information.

The more you need to go away and come back with information, the more time will be expended on your account by the planner – which in the end will cost you time and money. Failing to plan is planning to fail!

Looking for a quick fix

There are no ‘quick fixes’ to getting rich or retiring, this isn’t a Powerball planning session. Financial planning is the long game, it is about setting systems and processes in place to give you the absolute best opportunity to be financially stable in your future and into your retirement.

If you are walking into your financial planners thinking that you will walk out in a couple of hours with fists-full of cash – you are wrong.

What you will walk away with is a plan, a clear mind and a strategy on how you can set a course for your financial future. Even if you have inherited a significant amount of money or property from the estate of a deceased one, looking for a ‘quick fix’ is a sure path to losing some or all your money.

Irregularity of reviews

Although it may be annoying to set aside $500 per quarter for a review of your financial plan, review your assets and progress, and to look at any new funds, insurance or superannuation options that have come available – it is important.

As we showed in an early chapter, making the smallest of changes, and investing them wisely can make huge differences in your future financial stability and security.

It is vital that you have at least quarterly reviews with your financial planner, to ensure that everything is on track, that your investments are working as they should according to your plan and that if you need to iterate anything – that is to change any investments for any reason, then you are able to do so.

Honesty and Transparency

It does not matter what your financial situation is, or how much money you think you should have, not being honest as to your costs of living, your debt amounts, your income, savings, and other assets. On both sides of the fence – both the client and your financial planner – you both need to be open, honest and transparent.

Putting all your cards on the table early will ensure that you have a clearly defined starting point, goals & objectives while also you understand how the fee structure is set, where your money is going and why.

Don’t be too proud, ashamed or worried about what your financial planner ‘will think about you’, they are not there to judge, they are there to be your financial guide.

Failure to set or work within a budget

One of the most important factors with any financial plan is that you are working within and to a budget. If you are unable to curb excessive spending on discretionary items, thus leading to you being unable to invest, save or pay down that which you have set out in your financial plan – then your success is going to be hampered.

Just like being honest and transparent on the about of debt/equity, you have on your balance sheet – you need to ensure you stick to ‘the plan’ as you have agreed to do with your financial planner.

If you don’t stick to a financial plan, you could see your investments dwindle, putting downward pressure on your household – should you commit to investments that you cannot withdraw from for a period – such as a development fund or term deposit – or you won’t be able to achieve the objectives and goals you set out for yourself.

Financial Planners and advisors are charged with managing your money for your future. It is not about they want, their ideas or their interests, it is of the upmost importance that you remember that you are the client and it’s your money.

In recent times, the Royal Commission has gone along way to stamp out a lot of the ‘cowboys’ of the industry, but there are some key watch-outs when it comes to financial planning.

It’s about you!

As mentioned in this and previous chapters, your financial journey is about you, your family, your future, your retirement and your succession planning. Therefore, it is so important to engage your accountant, lawyer and financial planner/advisor collaboratively, so that your needs are being met.

In some instances, it has been seen that financial planners and advisors recommend products and services that they best benefit from – in terms of commissions and kickbacks – while not necessarily being the best for you.

This is something that you need to ensure you ask for ‘like for like performance of the fund/ investment/ insurance vs. comparable options or substitutes. No different to you looking at several open homes from several different agents before you commit to buying a house.

And just like buying a house, you are well within your rights to have your ‘building and pest inspections’, by asking your accountant and/or lawyer to review the details and provide independent and trusted advice.

You are not expected to be a financial expert

One of the common issues as a client is that you are not a financial expert. You may not jump out of bed and read the financial section of the financial review each morning. You may not have been through a finance degree, nor be an accredited financial planner – and you are not expected to be.

As part of the ‘duty of care’ that your financial planner is obligated to provide, they must explain everything to you within your current level of understanding. They should avoid bamboozling you with financial jargon, be condescending and push products or services on you, or have you sign up to things that you simply don’t understand.

It is ok not to understand financial products and services, as it is often said that they were designed complicated by Wall Street Bankers so only they – and a select few - could understand them.

As a client, you have every right to understand what you a signing up for and not be treated by anyone you are paying fees to in a demeaning way. IF this is happening, report them to the Financial Planning Association and see how they like that?

Communication is the key.

A trait of a good financial planner is clear, concise and regular communication with clients. Thanks to digital mediums – such as Zoom, Teams, Slack, Asana and more, there is no excuse even in a COVID-19 lockdown for financial planners not to be communicating with you.

Communication is the key to sound and prompt decision making, and if your financial planner is not returning your calls in a timely manner, not responding to emails or not uploading files to you as they said they would – you need to call that out.

However, on the flip side, remember they are busy running their own business, with other clients and their own small business considerations – so there is a balance.

Honesty – they must speak their mind!

When it comes to your financial matters, you want a financial planner that can speak their mind – and call the situation as it is.

You may get upset or feel embarrassed by their feedback or observations on your financial position, but it is better than signing up for services or investments, financial plans, or policies that you can’t afford or that are not right for you.

Not only does the planner need to speak their minds and be honest, but so do you as the client. It is paramount that you have a two-way, open and honest conversation – otherwise things will get missed, skipped or overlooked.

Issues with getting a second opinion.

Many professionals do not like their work critiqued by other professionals – no where more than in the financial services sector.

There are most certainly going to be differing opinions in the selection of financial product and services by your trusted advisor – ie. lawyers, accountants, financial planners etc – however, it is always important to get a second opinion.

As previously outlined, there are clearly defined roles and responsibilities of your professional service providers, they should not cross over. That is not to say that your accountant cannot review the validity of an investment option or change of superannuation provider as a ‘fresh set of eyes’.

Remembering they have financial training as well and know what to look for. Meanwhile, your lawyers can review the fund or investment options, check the legal validity, and undertake some due diligence for you.

It’s important to keep your advisors in their swimming lanes, but it never hurts to get a second opinion – remember it’s your money and your future we are talking about here.

The Financial Planning Association and Royal Commission into the banking and financial services sector have largely stamped out much of the bad advice and unscrupulous operators in the industry. However, unfortunately where there is money, there are people wanting to take advantage.

This may not be your financial planner themselves, but it may be those around the planner – you never know. As such, it is always important to take your time, never rush your decisions, review all the PDS (product disclosure statements) and get a second opinion – remember, it is your money and your decision.