Going to any large institution and asking their financial adviser for financial advice is not a bad idea. You may even find that some organisations offer you a cheap or free initial financial plan but in the long term this may cost you dearly.
When you seek financial advice, it is important to note there are potentially four major sets of fees to be aware of: an initial financial advice fee, an implementation fee, investment product fees and ongoing financial advice fees. Over the life of your investments, the investment product fees and ongoing financial advice fees can represent the major components of the total costs; particularly if the business owns or has a financial interest in the product they recommend.
When you get a second opinion, it may or may not be significantly different in terms of the original financial advice strategy offered, however from a cost perspective there could be an opportunity for significant long term fee savings. Unfortunately, some of the large institutions spend a lot of time maximising shareholder returns and executive bonuses so in-house investment and superannuation options can sometimes be a recipe for long term financial disadvantage. A smaller organisation can potentially be more cost effective and client focussed with a higher level of personalised service.
If you have a reasonable superannuation or investment balance, it has been our experience that with careful product and investment selection there can be an opportunity for significant long term fee savings from a second opinion. The great thing about fee savings is that they are yours, tax free, to spend or save as you see fit for the rest of your life!
HOT TIP: It is difficult to know what you don’t know. So why not take the opportunity now to do a stock take on your financial affairs and consider if you would reject fee savings if they could be made available to you?
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