Thinking about hiring a financial advisor? Great move. But before you hand over the keys to your financial future, there are some crucial questions you need to ask. Choosing the right advisor isn’t just about credentials—it’s about compatibility, trust, and clarity.
Let’s dive into the top questions to ask a financial advisor before signing on the dotted line.
1. Are You a Certified Financial Planner (CFP)?
Not all financial advisors are created equal. A Certified Financial Planner (CFP) is the gold standard worldwide. It means the advisor has completed extensive training, adheres to ethical standards, and is committed to continuous education.
Always ask for their credentials and check them against the Financial Advisers Register.
2. Are You Independent or Tied to a Financial Institution?
Some advisors operate independently, while others are aligned with banks or financial institutions. Tied advisors may be incentivised to recommend in-house products, which can compromise objectivity. You want someone who works for you, not for a corporate sales target.
3. How Do You Get Paid?
There are several models in Australia: fee-for-service, percentage of assets under management, and commissions from products sold.
Ask for a breakdown of all potential costs. Transparency here will protect you from hidden fees and help you assess whether their services deliver good value.
4. What Services Do You Offer?
If you’re asking yourself, “Is it worth paying for a financial advisor in Australia?”, consider the breadth of what they offer.
Advisors vary widely in scope. Some specialise in investment advice, others in holistic financial planning, which may include budgeting, insurance, SMSFs, aged care planning, tax minimisation and estate planning. Choose an advisor whose services align with your financial goals.
5. Who Is Your Typical Client?
You want to know if you’re a good fit. Some advisors cater to high-net-worth individuals, while others focus on younger Australians or families. If you’re starting out, you don’t want to end up with someone who only works with retirees or business owners.
6. What Is Your Investment Philosophy?
Do they believe in market timing, or long-term diversification? Are they active managers or passive indexers? These are critical questions to ask a financial advisor in the first meeting.
An advisor’s investment philosophy should resonate with your risk profile and goals. Ask how they tailor portfolios to individual clients.
7. Can You Help with My Superannuation?
Superannuation is one of the most tax-effective ways to grow wealth in Australia. Ask how they can optimise your super contributions, select the right fund, or structure a self-managed super fund (SMSF) if appropriate.
8. Will I Receive a Written Financial Plan?
Verbal advice can be misremembered or misunderstood. A written plan clearly outlines goals, recommendations, and the rationale behind them. In Australia, advisors are legally required to provide a Statement of Advice (SOA). Make sure you receive one.
9. Can You Provide References?
Ask for references from clients with similar financial situations. It’s one of the simplest yet most overlooked questions for a financial advisor. A reputable advisor will gladly share testimonials or case studies (with client consent).
10. What Happens If You Leave or Retire?
Advisors are people too—and they move on. Ask what happens to your account and financial plan if they leave the firm, retire, or take an extended absence. A clear succession plan is crucial for peace of mind.
11. Are You Licensed with ASIC and Do You Comply with Best Interest Duty?
In Australia, all financial advisors must be listed on ASIC’s Financial Advisers Register. They are also bound by the Best Interest Duty, meaning they must prioritise your interests over their own. Verify their licence, and ask how they demonstrate compliance.
12. Have You Worked with Clients Like Me?
Ask about their experience with people in your life stage—whether you’re starting your career, saving for a home, juggling a young family, or concerned with retirement planning. Practical experience with similar clients means more relevant and actionable advice.
Red Flags to Avoid When Choosing a Financial Advisor
Choosing the wrong financial advisor can do more harm than good — and leave your finances in a tangled mess. So how do you spot the pretenders from the professionals?
Here are the tell-tale warning signs that should make you pause, dig deeper, or even walk away entirely.
- They dodge questions about fees: If they’re vague or evasive, that’s a major red flag. A trustworthy advisor should be crystal clear about how they make money.
- They push one-size-fits-all products: Good advice should be tailored to your unique goals, not pulled from a standard script.
- They lack transparency: If they won’t show you their licence number, disclose product affiliations, or give you a clear plan, proceed with caution.
- They can’t clearly explain their value: You should know exactly what you’re paying for and how it benefits you. If they can’t articulate that? Time to move on.
- They’re not listed on the ASIC Financial Advisers Register: This is a non-negotiable. Unlicensed advisors are not only breaking the law—they’re putting your money at serious risk.
- They use high-pressure sales tactics: A professional advisor educates you and helps you decide, not rush you into decisions.
- They make promises that seem too good to be true: Like guaranteeing high returns or ‘beating the market’ consistently. No one can predict the future.
- They won’t provide references or reviews: A reputable advisor should have nothing to hide.
If anything feels off, trust your gut. A financial advisor should make you feel informed, not intimidated.
Ready to Take the Next Step? Talk to 360 Financial Strategists
Smart financial decisions start with the right advice—and the right advisor.
At 360 Financial Strategists, we believe financial advice should be transparent, empowering, and tailored to your life. Whether you’re starting your financial journey or reviewing your current advisor, we’re here to help you ask the right questions—and get honest, actionable answers.
