While managing your finances both for the short and long term can be challenging, it is important to get it right. Having an expert’s guidance with your day to day budgeting, as well as setting and meeting medium and long term goals, can be hugely helpful.

We take a look at the different types of advice available, how to access them, and what to look for when choosing someone to help you out.

The value of good advice

Changing from two incomes to one, budgeting, paying off debt, saving for a house deposit, choosing insurance, inheriting money, selling an asset, a new job, tax calculations, and making investments are all situations that you might need to deal with at various times in your life.

These are all quite varied situations and conducting your own research and building your knowledge across all these areas can be time consuming (and confusing!). While it’s important to do some of your own research, tapping into someone’s specialist knowledge can often help you achieve a better financial outcome.

You can also use different providers for different things – a specialist insurance adviser might be able to get you better insurance coverage for less than you are currently paying while a mortgage adviser can easily give you advice about all the banks’ offerings and options.

Another benefit of using specialist advice is that it can help remove the emotion from decision making and reduce tension between you and your partner as you make difficult decisions. You can also ensure that your finances are structured in a way that protects both parties in the event of a relationship breakup or bankruptcy.

Types of advice

There are different types of financial advice available for different things – so choosing what advice and who will give it can be tricky.

A financial mentor is someone who can get alongside you and your family and help get control of your money while taking into account your family’s unique situation. They will know how to access local support services and organisations and operate independently, ie they are not ‘selling’ a product. They can help with budgeting and debt management. The great news is that you can access a financial mentor’s advice free – check out www.moneytalks.co.nz for more information.

Financial advisers are generally used for longer term financial advice such as saving for a house deposit, mortgages, insurance, and investments. If your budget is working well for you and now you are looking to plan for the future, a financial adviser is ideal. There are many different types of financial adviser but they all need to be licenced by the Financial Markets Authority, and hold a licence or work for someone who does. You can check the register here. They need to disclose this information to you and also how they are paid, ie if they are paid by a company to sell a certain product. They are however obliged to put your interests first.

Finding the right advice

They key to finding the right advice is to be clear what advice you are looking for and then to do some research about the right person for that goal. Ask around and feel free to question advisers before you commit to them.

Again, it’s worth checking that the adviser is licenced, and finding out how the adviser expects to be paid by you or is on some sort of commision or bonus structure from a company. They are however going to be a member of your team and therefore need to put your interests first.

You can find out more about how to choose an adviser here.

What financial advice do you need?

See more:

• Do I really need life insurance?
• Preparing a family budget
• Teaching kids about money