What are the best sources of financial advice?

The establishment of the internet has allowed both beginner and veteran investors to have greater access to financial information and resources. However, it is important that individuals are aware of the credibility and validity of the information they may use to inform their investment strategy as it can have significant implications on whether you are able to achieve your financial goals and objectives.

Engaging with a financial adviser

Choosing to consult with and receive advice from a financial planner is a highly valuable process that provides investors with a tailored and specific strategy that is relevant to their personal circumstances. Although there may be more upfront costs when receiving professional advice compared to reading free information on the internet, it can lead to considerable savings over time as you are more likely to remain disciplined and stay the course of your investment strategy.

Financial advisers are required to be registered with the Australian Securities and Investments Commissions and hold an Australian Financial Services License. This charges all advisers with a range of responsibilities and duties under the Corporations Act 2001 (Cth) including making all decisions based on the best interests of their clients. All advisers must have the relevant qualifications in order to practice within Australia and individuals can check this by searching up potential advisers on ASIC’s register. If they do not appear on the register, they are not a financial adviser.

Financial advisers will provide clients with a Statement of Advice which is a formal advice document outlining the financial strategies and recommendations suitable for the particular individual. This will take into account a range of personal and financial information so that the advice is appropriate and relevant to you and you only. To read more about what is contained within a Statement of Advice, please click here.

Internet Resources

Whilst financial advisers will provide investors with specific advice, information that is sourced from the internet is general in nature, not tailored to your individual circumstances and is often just factual information. This information may be outdated or could be highly speculative of future market movements and economic trends. Therefore, when reading this it is important to discern between what is worth listening to and what you should disregard. Information that you read on a financial website should NOT be taken as advice or something to be strictly followed as it may not be a recommendation that is suitable for your personal circumstances.

You may wish to take note of general investment fundamentals such as long-term investment strategies, dollar-cost averaging and diversification as these are important rules of thumb. However, the degree to which you implement or follow these principles will be dependent on the goals you wish to achieve and their timeframes, your current financial position as well as your age and investment time horizon. Therefore, it is impossible to relate the information you read online to every individual’s circumstance and hence why it should be taken with a grain of salt.

Social Media

Social media has become an increasingly relevant forum for individuals to provide and receive financial information. Despite this, it is suggested that investors err on the side of caution and put the information they hear on various platforms into perspective. Recently ASIC has taken a strong stance and has cracked down on unqualified social media personalities coined ‘finfluencers’ from providing financial advice. On March 22, 2022, ASIC announced they were closely monitoring some popular personal finance influencers and are considering taking serious action including prosecution if they find these individuals providing advice without holding an Australian Financial Services License (AFSL). This includes finfluencers who share links to investment and trading platforms and suggest various products to buy which ASIC explained could be considered as ‘dealing by arranging’ which falls within the scope of an AFSL.

Popular neo-broker platform Pearler immediately ended its affiliate deals and sponsorships with third party influencers following ASIC’s announcement. ASIC’s strong position on finfluencers not providing financial advice is to protect consumers and to provide greater clarity around the risks and requirements of issuing financial information.

Investors who are not armed with the right knowledge are more susceptible to following financial information that may not be suitable for their financial circumstances, goals and objectives. This can lead to serious implications that take many years to recover from and sometimes can never be undone. If you would like tailored financial advice that is relevant and appropriate to your personal needs, please click the link to organise a complimentary 20-minute consultation with an EPG Wealth adviser today.

 

 

 

 

This information is purely factual in nature. Please do not rely on this information to make any financial decisions as this information has not been tailored to your personal. circumstances. If you would like financial product advice or services please let me know and I will set up an appointment for you.

Any advice in this document is of a general nature only and has not been tailored to your personal objectives, financial situation and needs. Before acting on this advice, you should consider whether it is appropriate having regards to your personal objectives, financial situation and needs.

Before making a decision to acquire a financial product, you should obtain and read a Product Disclosure Statement (PDS) relating to that product, it is important for you to consider these matters and to seek appropriate advice.

The material contained in this document is based on information received in good faith from third party sources, and on our understanding of legislation and Government press releases at the date of publication, which are believed to be reliable and accurate.

 

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