I have around $250k in shares and want to look at handing it over to a financial advisor, I'm 56 don't own a home and not sure the best way to select a financial advisor, they all sound dodgy by just doing online searches.
Any recommendations on a good way to do this?
sounds like a tax accountant? You could do a tax return by yourself, but for some reason people pay someone to do their tax for them.
A tax accountant navigates the law and doesn’t advise on product.
Can't a financial adviser also navigate the law and advise on strategy and / or product (for a fee just like an accountant)?
@mrtin: They can if it’s in connection with the advice they are providing (I.e. explaining and calculating capital gains) but its ancillary.
In my experience most clients will seek clarification on the taxation side from their accountants when it comes to financial advice received.
The point I was trying to make is that an accountant doesn’t tell a client where to put their money and why. Their sole focus is to navigate tax law and explain tax strategies based on where the client feels comfortable putting their money.
$250k in shares and want to look at handing it over to a financial advisor
You need to ask what you want them to do with it? Fees are your worst enemy especially with a small pot of money.
I am thinking you just don't want the hassle of managing your own portfolio and have someone look over risk and returns.
For a small amount like that I'd sell and put it into total market index (Australia or Global) depends on on your preference.
Most professionals don't beat the index. Most of them are only good for tax planning not forecasting (therefore investing for) returns.
I have worked in the financial services sector for over a decade and dealt with many Financial Advisors and para planners.
First of all, most of them will sound dodgy because they want to sell you something in order to make money, that in itself does not make them dodgy though.
Keep in mind they want to sell you something when listening to what they tell you.
I have done my own reading before talking to financial advisors, in the end I determined that their fee of around $2000 for a Statement of Advice (SOA) is NOT worth it. I have not found their revenue model shift from trailing commissions to pay-for-service instilling any more confidence in them.
I know about insurances, some of their investment strategies, tax minimisation etc, so their advice is less of value to me.
Feel free to talk to a couple and get a feel of what they offer and how much, each person’s situation is different. Your’s for example is at the latter end of your working life with no home ownership, you may have different goals which FP’s may be able to help with.
Some more information can be found in the link below.
https://moneysmart.gov.au/financial-advice/choosing-a-financ…
I have around $250k in shares and want to look at handing it over to a financial advisor
Why?
Is it because you want to keep invested in shares, but don't want to manage them? Consider a range of low price and highly diversified ETFs (with a large allocation to indexes).
Is it because you're considering a late move into property ownership? A financial adviser isn't going to be of a great deal of help there.
Is it because you're approaching retirement and want to de-risk your portfolio? Consider what your risk profile and attempt to match to corresponding asset classes. Then, you may still be back at an ETF or managed fund solution.
Understanding why you want to do something is extraordinarily important. Without this, an adviser will "do something" for you, but simply turning up and "handing the shares over" isn't a solution.
Buy a property in a Retirement Village?
Any recommendations on a good way to do this?
Recommended way:
If you must:
Yes, I know, the past is no guarantee of the future, but you don't want to hand over your money to some loser who's only earnt half of the index, say, and charge you fees on top.
Check out a good industry super fund. Host plus is good. Sun super may give you free financial advice. Place your money in super until you decide what you wish to do. speak to Centrelink FIS officers on the implications of your decisions. shares need good investment skills to get the best risk return. Industry funds offer you the ability to invest in their tax sheltered funds in shares if you must. if you cannot stay on top o investment and trading skills, you should derisk by moving to the options I suggested which might let you invest more actively than passive index funds.
There is a lot of knowledge you need before you can dynamically create a porfolio which adjusts risk and return appropriately for your age. capital preservation is important, especially in a world recession. NOW. safety is better than risk, until a clear recovery and vaccine are in place.
you may need some tax advice so that you do not trigger too many profits in any one year as you shift from shares to a less active super medium which has tax benefits longer term.
You are on the right track.
They can't do anything you can't do yourself.