Financial planners are a waste of money, and time

[Peter 14.7]

Biggest issue for an accountant is that he/she can get into trouble for "giving financial advice" unless licensed to do so....

Cheers,

The Y-man

Whilst my control issues will not let me give anyone but me the call on my investments I use my Accountant as a sounding board. If I do this, how does the tax apply there? he does give general bus advica for our 2 businesses but never in writing ( he is no silly). Essentially he works as "devils advocate" with no vested interest.

Peter

 

[Aaron Sice]

sounds to me like you saw the "H&R Block" of FPs.

there ARE good ones out there - just clearly not the one you saw.

 

[Ausprop]

Someone who is fee-for-service and qualified as an accountant, financial planner, solicitor and mortgage broker could be handy to give you some integrated advice. I know a few people who have 3 qualifications but not any with all 4...and fee-for-service.

even solicitors specialize i.e. lawyer, barrister, judge, criminal, civil etc. all 4 in 1 is a big ask!

 

[steveadl]

Anyone been advised by their financial planner to put some money into timber investments?

http://www.businessspectator.com.au...-huggers-pd20090506-RRSRP?OpenDocument&src=ei

The Timbercorp money-harvesting operation is a perfect example of the problem. If I put $100,000 into one of its schemes to get rid of some taxable income in June, $10,000 of that goes to my financial planner in cash, so I actually invest $90,000.

Is that $10,000 a reasonable payment for the service the planner has provided to me? How many dollars per hour does it represent? Has the planner researched all the available options and come up with the best, and safest, one for me? Or has he simply paid one of the independent research companies to provide some fig-leaf documentation supporting a recommendation that will earn $10,000 cash.

 

[Ausprop]

let's face it - if you made a lot of money then your FP is a legend, if you lost a lot then ASIC should lock him up

 

[Hoffy]

Anyone been advised by their financial planner to put some money into timber investments?

http://www.businessspectator.com.au...-huggers-pd20090506-RRSRP?OpenDocument&src=ei

I know a bloke who was a BDM for one of these agribusiness floggers. I can tell you that plenty of this stuff was also sold by accountants under limited authorities provided by the promoter. Effectively they got the company BDM to issue the "advice" and the accountants picked up the 10%. He had just as much sales success via this method as he did with FP's.

 

[JamesGG]

Interesting article on the future direction of the financial planning industry. We'll see how it pans out, though, and I'm not holding my breath waiting.

And another, on further possible outcomes from the recent fallout around the larger tax-effective 'investment' schemes.

I'm known to be a little optimistic but even now, I wonder if it's a little naive to hope that these two events *might* just lead to a slightly higher standard in the industry...

 

[LynnH]

James

I read both those articles with much interest - and, like you, I'm not holding my breath waiting.

Hopefully, though, it's action in the right direction and might result in some of the 'cowboys' leaving the industry.

Cheers
LynnH

 

[Qlds007]

Quicker this happens the better.

some of the 'cowboys' leaving the industry.

 

[FinSpec]

This is such a hot debate at the moment, so I thought why not just throw in my $0.02 worth!

Our firm moved away from commissions a long time ago, simply becuase we knew that it was right thing to do. Today, we are 100% fee based, and it's quite a liberating feeling to know that you don't have any conflicts of interest.

You'll find that the industry has "grown up" on a diet of insurance, managed funds and superannuation. It is going to take some time to get financial planners to accept property, holistic planning rather than the share bias that there is out there at the moment. Because most of the "dealers" out there control their planners, and the "dealers" are owned or controlled by banks and/or investment product providers, you can see where some of the bias comes from.

However, one issue that is really interesting is that when a younger financial planner is studying, most of the study is around managed funds, shares, super etc. Very little attention is given to debt reduction strategies, property accumulation ideas, asset protection etc etc.

So, we're not teaching planners the right way, their mentors grew up learning the wrong things, and the firms that ultimately control a large part of the industry only have self interest at heart.

An finally, the Aust Govt Treasury came out with a statement recently saying that "Getting rid of commission, while good as an idea, has too many practical issues that will make it impossible to do" - so we expect to see some pretty watered down legislation regarding commissions - if they make many changes at all.

I've been proudly recommending real estate for all my clients for my whole career, so do all the other planners that we work with. It came from growing up in the right culture. One day, we expect what we do is the norm. For now, however, I still get some very strange looks at industry days when I tell people how we do what we do.

Ok, maybe that was about $0.08 worth this time, but just had to share a little