Financial Planner
Common Mistakes When Choosing a Financial Adviser
Written & Reviewed by James Hayes ·
Summary
Avoid adviser selection mistakes by verifying licensing, getting fees in dollars, and confirming scope, cadence, and deliverables in writing. Probe conflicts and platform bias, demand projections with assumptions, and check data security. Ask about continuity, exclusions, and the first 90 days. Choose the adviser who proves process, not the one who makes grand promises.
Red Flags When Choosing a Financial Adviser Guide. Download Free Guide.
Introduction
Finding the right adviser is often a long and arduous journey, which is worth it when you come under the guidance of a professional you can trust. Sadly, there have been several cases where hasty and uninformed decisions culminated in unpleasant experiences, including loss of money.
This guide walks through the mistakes people make most often, then moves into the subtler traps that appear only after you sign. Some sections include checks you can use before you book the first meeting.
What Does a Good Selection Process Look Like?
A sound process is simple: verify licensing and experience, confirm scope and fees in writing, review the service model and who does the work, and request a sample of deliverables. You want predictable steps, clear boundaries, and documented advice. Keep this frame in mind as you scan the mistakes below.
Before you proceed further, you might want to read How to Choose the Right Financial Adviser in Australia.
Category 1: The Obvious Mistakes
These are the red flags that are easy to check yet frequently overlooked. Take five minutes to clear them before you invest more time.
1) Not Verifying Licensing, AFSL, and Complaint History
Every individual adviser must be listed on the Financial Adviser Register (opens in a new tab), and they must advise under an Australian Financial Services Licence (opens in a new tab). Ask for AFCA details (opens in a new tab) and check how complaints are handled. A professional will volunteer this upfront and invite you to verify it.
What to ask:
- What is your AFSL, and where can I verify your authorisations?
- Are you listed as an individual on the Financial Adviser Register?
- If I have a complaint, what is the exact process and timeline?
2) Choosing Purely on Brand, Proximity, or Charisma
A well-known brand, a nearby office, or a great first chat is not evidence of capability. You are hiring a decision system. Ask for proof of process, not odes on personality, and make sure the adviser’s core work will help you with the decisions you need to make in the next 12–24 months.
3) Not Demanding Fee Clarity in Dollars
Fees should be stated in dollars, in writing, for both upfront work and ongoing service. Percentage-based statements can hide the real cost as your balances grow. Insist on a dollar schedule with inclusions, exclusions, and payment points.
| Fee type | How it works | Risks to watch |
|---|---|---|
| Fixed project fee | One-off for scoped advice and SoA | Scope creep if inclusions are vague |
| Ongoing retainer | Flat dollar fee for reviews and admin | Paying for services you do not use |
| Asset-based fee | % of assets, billed periodically | Costs can rise without extra work |
| Hourly rate | Pay per hour logged | Less predictability without a cap |
Read What Does Financial Advice Cost in NSW? for information on fees, models, examples, and how to budget.
4) Skipping a Written Scope Before the Statement of Advice
A written proposal should precede the SoA (opens in a new tab). It sets the scope, deliverables, and timelines so no one is guessing. If an adviser jumps straight to product talk or emails a document pack without a defined scope, slow down and recalibrate.
5) Accepting Vague Deliverables and No Timetable
You should know precisely what you will receive and when. Ask for meeting dates, modelling deliverables, and implementation checkpoints. If the adviser hesitates or handwaves timelines, expect delays later.
Category 2: The Less Obvious Mistakes
These issues rarely show up in the first conversation. They surface during implementation, when the market moves, or when your life changes and you need rapid, specific guidance.
6) Confusing a Portfolio Pitch with a Planning Process
Investments are a tool within a plan. If the first meeting fixates on tickers or platform features, you risk getting product selection without strategy sequencing. Ask how cashflow, super, insurance, estate documents, and tax settings will be coordinated and documented across a calendar.
7) Overlooking Who Does the Day-to-day Work
Many firms sell you on a principal, then hand you to juniors or a rotating pool. Continuity is important, especially at retirement. Ask to meet the person who will run your file, reply to your messages, and present the annual review.
What to verify:
- Primary adviser and backup contact
- Response expectations for email, phone, and WhatsApp
- Who attends implementation calls and reviews
8) Ignoring Review Cadence and Event-driven Support
Annual reviews alone are not enough for pre-retirees, SMSFs, or clients with multiple entities. You need both a standard cadence and the ability to trigger short, event-based advice when something material changes.
Compare service models:
| Model | Good for | Watch for |
|---|---|---|
| Annual deep dive + interim check-ins | Established retirees, stable portfolios | Drifting priorities between reviews |
| Quarterly cadence | SMSFs, active accumulators | Cost vs value if little changes |
| Event-driven add-ons | Property moves, inheritances, TTR switches | Clear pricing for each event |
9) Not Probing Conflicts, Product Shelves, and Platform Bias
Ask how the adviser gets paid, what platforms they use, and whether they have quotas or restricted product lists. A clear conflict-of-interest statement and a plain-English explanation of why a platform was chosen should be standard.
Questions that surface bias:
- How many platforms do you recommend, and why this one for me?
- What alternatives did you reject, and on what criteria?
- Do you receive any benefits from providers?
10) Accepting Projections Without Assumptions
A projection is only as good as its inputs. You should see wage growth, contribution rates, tax, fees, sequence-of-returns assumptions, and withdrawal rules. If a graph appears without a full input sheet, ask for it before you decide.
11) Neglecting Data Security and Document Controls
Financial files contain sensitive data. Confirm how documents are collected, stored, and shared. You want secure portals, e-signing with audit trails, and explicit controls for bank details and beneficiary nominations.
12) Underestimating the Value of a Meeting Record
Ask for meeting notes and action lists after every session. File notes protect you, help the adviser keep momentum, and reduce mistakes during implementation. They also make it easier to hand off tasks to your accountant or mortgage broker.
Category 3: The Least Obvious Red Flags
These are strategic blind spots. They do not always bite in year one, but they determine whether your plan holds up across a decade.
13) No Plan for Adviser Continuity and Succession
If your adviser is a sole operator, what happens if they step away for a period, or sell? If they are in a large corporate, how often do clients change hands? You need a written continuity plan with clear service standards.
14) Weak Change Management for Retirees and Near-retirees
Retirement is a period of rapid decisions: contribution timing, TTR toggles, pension commencements, and estate updates. Ask how the adviser sequences decisions across the financial year, and how deadlines are tracked to avoid irreversible mistakes.
Learn about the Financial Planning Process or get help deciding When to Get Financial Advice.
15) Poor Integration with Your Accountant, Broker, or Solicitor
Good advice is multidisciplinary. Confirm that your adviser is willing to speak with external professionals, share documents securely, and coordinate tax and estate implications before implementation.
16) No Evidence of First-hand Experience with Your Scenario
Look for case-style examples that mirror your situation: SMSF trustees in their 50s, couples retiring in the next year, or professionals juggling equity plans and property. Generic claims are easy. Specific, de-identified examples show experience.
17) Thin Governance Around Ethical Investing Requests
Ethical preferences require explicit filters, not a marketing label. Ask how screens are applied, how trade-offs are handled, and how ongoing monitoring works. You should see a written approach, not a one-line promise.
18) Missing Boundaries on Communication Channels
Fast communication is helpful, but boundaries reduce errors. If your adviser uses WhatsApp or SMS, ask how decisions are captured in the record, and how sensitive documents are handled. Informal channels should be mirrored in formal file notes.
19) No Clarity on What the Adviser Does Not Do
A professional draws lines. For example, some advisers like James Hayes do not lodge Centrelink forms or handle debt consolidation. Clarity on exclusions saves you time and avoids mismatched expectations.
20) Failing to Map the First 90 Days
The bedding-in period is where accounts move, contributions start, and providers change. Without a 90-day checklist and confirmations, tasks drift and delays compound. Ask for a milestone list with who does what, and when each step is considered complete.
A Compact Pre-meeting Checklist You Can Use
The list below is a quick tool to stress-test an adviser before you commit.
- Licensing verified, AFSL listed, AFCA process provided
- Written scope, fees in dollars, and timetable supplied
- Service cadence defined, event-driven support priced
- Conflicts disclosed, platform choice explained, alternatives shown
- Projections delivered with full assumptions and inputs
- Secure portal and e-signing confirmed, meeting notes provided
- Continuity and escalation paths documented
- Exclusions stated clearly, with referrals where relevant
Use this as a gate before the Statement of Advice is commissioned.
How James Hayes Addresses These Risks
James is independent of banks and large institutions, serves clients across the Sutherland Shire and Sydney CBD, and provides fees in dollars with clear inclusions. Meetings include whiteboard modelling, written notes, and a predictable review calendar. If a request falls outside scope, he says so early and offers alternatives.
Conclusion
Choosing an adviser is easier when you slow the process, test for proof over promises, and insist on written clarity. Check the obvious items, probe the less obvious frictions, and confirm the strategic safeguards. If each layer stands up, you have the foundations for a long, productive relationship. If you have a positive feeling about James Hayes, feel free to schedule a complimentary 15-minute introductory phone call (opens in a new tab) with him.
FAQs
How do I verify an adviser quickly before booking?
Search the Financial Adviser Register (opens in a new tab) for the individual’s listing, confirm the AFSL (opens in a new tab), and ask for AFCA details (opens in a new tab). Request a one-page summary of scope, fees in dollars, and review cadence. If those arrive promptly and read clearly, book a discovery meeting and bring statements so we can test fit.
What is the best way to compare fees across advisers?
Ask each adviser to quote in dollars for the same scope and timeframe, with inclusions, exclusions, and payment points. Request a worked example using your balances. Percentage quotes can mask costs as assets grow. A clean dollar schedule is the simplest way to compare value, not just price.
How do I spot product or platform bias in the first meeting?
Ask which platforms were considered, which were rejected, and why. Request the criteria, such as fees, functionality, custody, and reporting. If you only see one pre-selected option without alternatives, probe further. A good adviser explains the decision, the trade-offs, and how conflicts are managed.
What should the first 90 days look like after I sign?
You should see a dated list: account setup, transfers, contributions, insurance updates, beneficiary nominations, and confirmations. Expect secure document exchange, e-signing where possible, and written status updates. At day 90, you receive a summary of what is live, what is pending, and next review dates.