# When to seek financial advice?



## Adrian. (5 January 2011)

Hi,
I'm in my mid twenties and am just about to start my first 'real job'. That is; my first salary paying job. I'll be getting about 50k pa. I have about 5k in two super funds and about 20k in savings/shares that I saved/invested during uni. I rent and don't own any other assets. I have no debts.

When does it become financially viable to get financial advice and what sort of advice do I need? Where should I get the advice (accountant or financial advisor)? How should I choose one (I can't ask family/friends because they don't have financial advisors)?

I handle the investment of my savings and would like to continue doing so but I have questions about my super (choosing a fund, how much to salary sacrifice, choosing risk level), minimising tax and the first home buyers savings account. I'm sure there is other stuff I don't know I should ask about as well.

So, do you think it's worth my while getting advice and who should I get to do it?

If you don't think it's worth it now, When do you think it would be?

Thanks for any help


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## SM Junkie (5 January 2011)

It sounds like you definately have many questions for a financial advisor.  My only advice is to seek a FA that charges a fee for service, mine costs about $250 an hour base rate. Otherwise you will be signed up for a whole lot of things you may not need.

Great to see a young person with their head on straight and thinking about their financial goals early.  Good luck.


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## So_Cynical (5 January 2011)

Adrian. said:


> I have about 5k in two super funds.
> 
> When does it become financially viable to get financial advice and what sort of advice do I need? Where should I get the advice (accountant or financial advisor)? How should I choose one.




One low cost option would be to get some advise via one or both of your super funds...im reasonably sure most super funds offer either free or low cost advise, just beware that you only get what you pay for.


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## Market Depth (5 January 2011)

By the looks of things, your doing a pretty darn good job yourself Adrian. Take your time, choosing. Allocate a budget for future financial advise. Most importantly, keep doing what your doing, your well on the way.


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## burglar (5 January 2011)

Adrian. said:


> Hi,
> ...
> So, do you think it's worth my while getting advice and who should I get to do it?
> 
> ...




https://www.aussiestockforums.com/forums/showthread.php?t=17080

Don't know if this helps!? (specially as the said "chatroom" has been lost in the latest upgrade) But it is good for a laff and goes a long, long way to explaining the responses you will undoubtedly get.


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## pixel (6 January 2011)

Adrian. said:


> Hi,
> I'm in my mid twenties and am just about to start my first 'real job'. That is; my first salary paying job. I'll be getting about 50k pa. I have about 5k in two super funds and about 20k in savings/shares that I saved/invested during uni. I rent and don't own any other assets. I have no debts.
> 
> When does it become financially viable to get financial advice and what sort of advice do I need? Where should I get the advice (accountant or financial advisor)? How should I choose one (I can't ask family/friends because they don't have financial advisors)?
> ...



 Hi Adrian,

I have to commend you for the foresight and "sobriety" that your questions demonstrate. It's young people like you that keep alive a faint glimmer of hope hat we could still justify the tag "clever country", if only in small pockets of our population.
In a truly "Clever Country", your question would've been part of every school curriculum, covering financial basics like budgeting, calculating interest and compound interest, comparing debt levels, repayment terms, return on investment, basic tax implications ...

Sadly, although it ought to be part of basic life skills, it's only taught in special Higher Education courses at Uni, and even then only if you buck for a Business or Economics degree.

After heaving that big sigh, here is what I would do:
1. Visit your Bank and ask for a private consultation. Ask all the questions that come to mind (you'll go prepared, of course) and where you either don't know the answer or have found ambiguous opinions when you Googled the www.
2. Take the answers with a grain of salt. Don't sign up to anything, but go home and evaluate: "What would I have said if I wanted to get a piece of Adrian's money into my bank?" (Research "commissions" - trailing, up-front, ongoing... Some advisors take a small cut; others refund them all to you...)
3. Go to the next Bank and ask the same questions. Evaluate...

If a bank employee is honest enough, they will tell you which questions they can't answer. Most likely, they will stub their toes at tax implications, risk/reward, and possibly when it comes to comparing different asset classes. Some may know a lot about those things, or they may pretend to do ... That's why you should ask at least 4 or 5 different banks - and compare answers and suggestions.

Regarding tax advantages, salary sacrifice etc - don't jump the gun. Depending on the size of the company that you join, you may be able to have a chat with someone in the Pay Office. If it's a small company, they will at least be able to recommend a tax accountant "who does these things for us". 

(The cynic in me is almost tempted to suggest "Don't put more into Super than you have to. By the time you get to the stage where you get the use of it, succcessive gov'mints will have changed the grund rules so often that it may be worthless. Provided you have the self-discipline to plan and save on your own account, do so and enjoy the flexibility without being hamstrung by bureaucracy and red tape.")

You can find out the tax tables by yourself; every dollar you earn between $37K and $80K p.a. is taxed at 30%. It MAY be worthwhile to sacrifice a couple of Grand if it gets your taxable income down below $80K. Maybe likewise a few $$ near the $37K threshold. But as you're starting at $50K, I wouldn't bother either way. There are other ways to reduce tax: ask a good accountant. You may even be able to afford doing nothing for now, then have the discussion with someone in July. Advantage at that time: You have concrete figures and can "do the sums and what-ifs" based on facts, not theories.

Good luck - I'm sure you'll make your own


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## Julia (6 January 2011)

Great post, pixel.   

Agree that it's heartening to see a young person taking such a sensible approach.
Wish there were more.


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## tech/a (6 January 2011)

Adding to Pixel's post.

I question *"WHO"* to gain advice from.
Most you will ask are in a similar position to yourself.
Many will have trained theory but zilch in the experience department.

I tackled my financial/Business/Trading and Property education a little differently.

*I tracked down people I KNEW were successful
In each field*---quite a few of them.
I started at 25 yrs of age and a few are still friends 30 yrs later! I still do it. (Some sadly are not here!).

*I'm sure you'll find very different answers* to your questions from these guys!

I was up front and would call them and tell them I had researched and found they were very good at what they do and wanted to ask some questions about their field.
Could you make the time to join me for a chat over lunch ---Id buy!!

I found many lunches went for hrs and I took notes!
I worked on building a relationship with these people where I got to the point where it was OK to run ideas or cases past them.


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## Liar's Poker (6 January 2011)

Adrian. said:


> Hi,
> I'm in my mid twenties and am just about to start my first 'real job'. That is; my first salary paying job. I'll be getting about 50k pa. I have about 5k in two super funds and about 20k in savings/shares that I saved/invested during uni. I rent and don't own any other assets. I have no debts.
> 
> When does it become financially viable to get financial advice and what sort of advice do I need? Where should I get the advice (accountant or financial advisor)? How should I choose one (I can't ask family/friends because they don't have financial advisors)?
> ...




Adrian, 

I'm in a similar situation (mid twenties, not a heap of net wealth and a nice Hecs/Help debt). I have been working for a 4 and a bit years in a 'real job' (was lucky enough to get employed part way through my uni study) and have been slowly going through the process of setting up and understanding my life.

Although I have done much of the research myself, one good resource I have had available is the financial planner my employer contracts.

Depending on who your employer is, they may offer this service and it is a worthwhile check as it is often offered free of charge. The company I work for is rather large and pays for a financial service consultant to run our superannuation and insurance scheme, as well as offer advice to employees.

Although they can sometimes be bias towards certain products, I always find it worthwhile sitting down and talking them through my plan, as well as challenging the products they have negotiated for the employees (private health over, superannuation, novated leases, etc). 

For example, we have an excellent superannuation fund with plenty of options as well as free income protection insurance. On the other hand, because of my age and material status, the companies private health cover couldn't beat the price and coverage I found myself with an alternative product. With both situations, I was able to sit down and go through my options and make sure I was making an informed decision.

Nonetheless, if your employer does not offer this, it is still worthwhile doing as much research as you can on each of these topics whether you get a financial planer or not. Agreeing with what Pixel has written above, I would also utilise resources such as:


Magazines such as "Smart Investor", which often cover superannuation, private health, taxation, etc rather helpful. Many issues do comparisons of products, which not only points you in the right direction but also highlights areas you should be questioning.

Work superannuation committees (if they exist at your workplace). Even if your just taking minutes, your learning curve will go through the roof.

Websites of Super funds, Private health companies, financial advisors, etc - each of them are trying to sell a product so you can often obtain plenty of information without leaving your home or paying a cent.

Forums like this one. Although you have to take everything with a pinch of salt, people on the internet are generally very honest. Meaning you can learn from others mistakes and successes by browsing and reading very easily.

To answer your question. 

_So, do you think it's worth my while getting advice and who should I get to do it?_

If you are not comfortable with your knowledge base, or just require someone to bounce ideas off of - then yes. No problem at all getting advice. With regards to who, obviously it depends on your location, but I personally would be looking for a medium sized firm that still has the time of day for you, while also having the resources and financial backing to be around for you in 20 years time.

If you don't think it's worth it now, When do you think it would be?

Like I said above, there is nothing wrong with seeking advice now (just so you can get everything set up right from the start). You're better off making sure you have the right insurance cover, private health insurance, etc before you take some larger financial risks, like buying a house. 

Hope that helps.

-Liar-


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## Liar's Poker (6 January 2011)

tech/a said:


> Adding to Pixel's post.
> 
> I question *"WHO"* to gain advice from.
> Most you will ask are in a similar position to yourself.
> ...




That's a great point Tech/a. 

Similarily, I have two strong business mentors I use for my career that have been extremely influential. Brilliant resources to tap - even for things like personal finance advice.

Although I bought the first lunch, the advice since has been charitable (I did buy them each a bottle of wine for Christmas). I think they just enjoy having someone to share their experiences and part advice with. 

One mentor was from work, but now works at another company - made it easy to ask. While another was a client I asked after a major project.

-Liar-


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