The Value of Financial Advice

We view the value of Financial Advice as comprising of four key areas:

• Strategy: The process of analysing a range of alternatives and creating a strategy to meet client goals, objectives and facilitate their ideal life.  
  

• Product: Analysing then selecting the best products to facilitate the strategy.
  

• Execution: Any plan without ongoing guidance, regular check ins and accountability can easily go off track. 
  

• Time and Effort: Working with an adviser reduces time, stress and uncertainty thereby improving financial wellbeing.

Interestingly, many consumers still view Financial Planning through the primary lens of a 'product' solution. People will frequently ask in passing 'what super fund should I be with?' or 'what should I invest in?'.

However, what they should really be asking is 'how much do I need to save each month to reach my goals, and where should I allocate it?'. Whilst product solutions are an important part of our advice value, strategy and execution are more crucial and provide larger upsides.

Strategy:

• Detailed financial modelling to determine the savings rates required to meet the client’s goals and objectives.

• With the monthly surplus should we: invest, pay down debt, contribute into superannuation, do something else, or a combination?

• Tax strategies, should we: contribute to super, create a family trust, purchase an investment property, use investment bonds?

• Retail Super vs Industry Super vs Self Managed Super?

• Strategies to maximise government entitlements to Age Pension and/or reduce Aged Care fees.

Product:

• Selecting an optimal super option based on cost, past performance and asset allocation for the investor.

• Selecting the cheapest and/or best quality life insurer for a client’s Life Insurances and Income Protection.

• Selecting the right investments for clients based on their timeframe and objectives.

Execution:

• Keeping clients on track for hitting their cashflow surplus targets.

• Guiding clients through the journey to achieve their goals.

• Helping clients implement – the initial advice and yearly requirements (e.g., tax planning).

• Adjusting the plan for changes to client goals, life events, the economy and legislation.

Time and Effort:

Technically, Financial Advice is a discretionary service. However, doing it yourself properly requires:

• A very high financial literacy

• More of your own time

• You to be able to keep your own self accountable

• You to be able to make decisions without a sounding board, which can lead to more uncertainty or mistakes

• There is a certain limit to how well clients can do themselves based on expertise and access to Adviser tools/software

Conclusion:

Many people think Financial Planners only want to work with 'rich' people. For some Financial Planners that charge percentage based fees of Funds Under Management this could be a fair assessment, however at Source Wealth, we charge fixed fees based on time and complexity, so the amount of Funds Under Management doesn't matter to us.

However, there are a few reasons why our client base is typically made up of people on higher incomes and or/higher assets:

• Larger incomes = typically larger surpluses = more strategy alternatives = more advice value for the client.
  

• Clients on higher incomes often value their time at a higher rate, and often value working with a Financial Adviser to a greater degree as time = money!
  

• Greater financial complexity lends itself to requiring more financial expertise.  

If you are a high income or asset family who:

• Prefer to delegate their financial planning strategy so they have more time to focus on the things they are good at or enjoy doing.

• and, have ambitious goals and objectives and want ongoing help to facilitate their ideal life.

... then please book in your initial call to get started:

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