Choosing a financial adviser is a significant decision.
The right adviser can help you make informed decisions, stay focused on your long-term goals and build lasting financial wellbeing.
The wrong fit can leave you uncertain about the advice you are receiving or unclear about how your adviser is being paid.
Here are some red flags to look out for when choosing a financial adviser.
Table of contents
What should you look for when choosing a financial adviser?
Is the adviser truly independent?
How should you assess fees and adviser alignment?
How can I tell if I'm paying too much for financial advice?
Why can a fee-for-service model offer clarity and stability?
Does the adviser work with people like you?
Are you looking for an investment adviser or a financial planner?
Should you be cautious of a single-solution approach?
How important is collaboration with your other professionals?
What should you do before making a decision?
It never hurts to get a second opinion
So, what matters most when you are deciding who to work with?
You may be looking for:
Not every factor will carry the same weight for every person. However, understanding the differences between advice firms can help you make a more confident and informed decision.
At Strategy First, we believe trust sits at the centre of every strong advice relationship. Trust is built over time, but there are often early signs that can help you assess whether a business is transparent, professional and right for you.
Book a free call with an independent adviser from Strategy First
Under Australian law, a financial adviser must disclose whether they meet the Corporations Act definition of independence. This information is usually set out in the business’s Financial Services Guide (FSG).
A transparent advice firm should make its FSG easy to find, often in the footer of its website. If it is difficult to locate, that may be a reason to ask further questions.
It is also important to understand that “independently owned” is not the same as being legally independent. A business may be privately owned, but that does not necessarily mean it satisfies the legal standard of independence. The FSG should help clarify that distinction.
Learn about the value of independent advice.
Strategy First's commitment to independence.
Every advice business needs to charge appropriately for its time, expertise and service. The important question is whether the fee model supports advice that is clearly aligned with your best interests.
This is where it helps to understand how an adviser is paid.
For example, where fees increase in line with the size of an investment portfolio, there may be circumstances where the adviser benefits more from one strategy than another. That does not automatically mean the advice is inappropriate. However, it is sensible to ask whether the fee structure could influence the recommendations being made.
A practical example might be whether surplus cash flow is directed towards investing rather than reducing debt, or whether wealth is retained in a portfolio rather than gifted to assist family members. In some cases, either option may be appropriate. The key is whether the advice is driven by your strategy, not by the way the adviser is remunerated.
Many people ask whether they are paying too much for advice. The answer depends on the value, scope and quality of the service being provided.
As a general guide, if you have $2 million invested through an adviser and the ongoing fee is above 0.80% per annum, or around $16,000 per year, that may warrant closer review. If the fee is closer to 1.0%, or $20,000 per year, it is reasonable to ask what services and outcomes you are receiving in return.
If you have $5 million invested, a fee above 0.65% per annum, or $32,500 per year, may also deserve careful scrutiny.
Of course, the right fee depends on complexity, service scope and the support you receive. If you are unsure whether your current arrangement represents fair value, an independent health check can provide useful perspective.
A fee-for-service model can create greater clarity for clients because the cost of advice is agreed upfront and is not tied directly to day-to-day market movements or portfolio size alone.
In our view, this model also supports a steadier advice relationship.
During periods of market volatility, clients often need thoughtful guidance, consistent review and calm decision-making. A stable fee structure can help ensure your adviser remains focused on helping you navigate change rather than managing the pressures created by fluctuating revenue.
It can also make quality strategic advice more accessible to people whose needs extend well beyond investment management. Areas such as cash flow, superannuation, retirement planning, estate planning and coordination with other professionals are all important parts of holistic financial planning.
Make an enquiry for fee-for-service financial planning
One of the most useful signals when choosing an adviser is whether they regularly work with clients in circumstances similar to yours.
This may be clear from referrals, client stories, testimonials or the way the firm describes the people it serves.
Some firms focus on clients above a certain income or asset level. Others may specialise in areas such as retirement planning, intergenerational wealth transfer, business owners, professionals or complex family structures.
When reviewing a website, look for evidence that the adviser understands the kinds of decisions you are facing.
The more closely their experience aligns with your needs, the easier it is to see how an ongoing advice partnership may work in practice.
Testimonials and reviews can also offer valuable insight, although they are only one part of the picture. Some highly regarded firms grow primarily through client referrals and long-standing relationships.
The importance of ongoing advice
All financial advice will involve some level of investment decision-making. However, there is a meaningful difference between an investment-focused adviser and a holistic financial planner.
A financial planner looks at how investments fit within your broader life strategy. That includes your future cash flow, tax position, retirement goals, estate planning considerations, family priorities and long-term objectives. The role is broader than selecting investments. It is about ensuring each part of your financial life is working together.
An investment-focused adviser may place greater emphasis on markets, portfolio construction and specific investment choices. That may suit some people, but if you are seeking comprehensive advice, it is worth checking whether the service extends beyond investments.
The difference is often visible in both the website content and the fee model.
Where fees are primarily linked to the value of your investment portfolio, the service may be more investment-centred. By contrast, where fees reflect complexity, advice areas and the level of support required, this often suggests a broader financial planning relationship.
You can also review the services listed on the website. If the firm speaks in depth about retirement planning, cash flow, superannuation, estate planning, tax-aware structuring and collaboration with other professionals, that is usually a sign of holistic financial planning.
Understanding the difference between a Financial Adviser and Investment Adviser
Yes. It is wise to be careful when a business appears to lead every client towards the same solution.
A consistent advice framework is not a problem in itself. In fact, disciplined processes and a clear philosophy can be strengths. The issue arises when the advice appears overly narrow, inflexible or built around one preferred outcome regardless of the client’s broader circumstances.
For example, some businesses may strongly emphasise a particular asset class or planning pathway. That may be suitable in some cases, but quality advice should begin with your goals, your financial position and the strategy most appropriate to you.
Good advice is not about validating existing preferences. It is about helping you make informed decisions through experience, objectivity and professional judgement.
For many people, very important.
Financial decisions rarely exist in isolation. Tax, legal matters, estate planning, lending and business structures can all intersect.
An adviser who is willing to work alongside your accountant, solicitor or other specialists can help create a more coordinated and effective strategy.
This kind of collaboration is often a sign that the adviser is focused on your broader financial wellbeing rather than a narrow advice scope.
Before choosing an adviser, take up the opportunity for an introductory conversation if one is offered. A meeting can tell you far more than a website alone.
It allows you to ask questions, understand how the adviser works, clarify how fees are structured and assess whether the relationship feels right. It is also your chance to consider whether the adviser communicates clearly, listens carefully and takes the time to understand what matters to you.
Choosing an adviser is not simply about qualifications or process. It is about finding a trusted professional who can provide independent, fee-for-service advice and support you over time as your circumstances evolve.
If you are reviewing your options, an introductory call can help you understand whether there is a good fit.
And if you already have an adviser but want a second opinion on your current arrangements, a complimentary health check can help you assess whether the advice, service and fees remain appropriate for your needs.
If you would like to speak with Strategy First, you can book an introductory call with one of our Independent Financial Advisers.
The information provided is factual only and does not constitute financial advice.