Here are some frequently asked questions that may help answer any you may have. 

If you don’t find the answers you’re looking for please feel to contact us.

Q. What is the difference between Financial Advice and Life-Centred Financial Planning?

A. Life-Centred financial planner (LifePlan) goes beyond just recommending financial products. The focus in more in the financial planning, the understanding of the client’s financial goals and ultimately how they can live the life they want to live. Financial products may be a part of the solution it but it’s very much secondary to the life planning.

Q. Is a financial adviser worth the money?

A. We hope so! There is much research to suggest that working with a financial adviser can lead to up to 3% increased investment returns per year compared to self-investing. However, the benefits go far beyond this in terms of the emotional support they provide and peace of mind that your financial life is in order.

Q. What is fee based financial planning?

A. Fee-based financial planners charge a fee for services covering all areas of a client’s finances from budgeting to investing and retirement planning. Fee-based financial planners remove the biases associated with commission based financial advisers who may recommend whatever pays the highest commission. Fee-based financial planners are paid the same regardless, so they recommend what is in the client’s best interest.

Q. What is Robo Advice?

A. Robo advice is online investment solution without the interaction of a human adviser. They might be good for people who are at the beginning of their investment journey as they have low minimum entry points. However, Robo advisers don’t normally provide a view of a client’s whole financial picture and add the human element that life-centred financial planners do.

Q. What do financial advisers charge?

A. Make sure you find a fee-based adviser that charges a fee for financial planning services. There is normally an initial fee to become a client, then an ongoing fee should you remain a long-term client. The fee is usually a % of the clients invested assets. Fee-based advisors are paid the same regardless of what products, if any, are recommended.

Q. Are financial advisers independent?

A. Not all financial advisers are independent. Some can only recommend products from one company and are only paid if you buy the product they recommend. An independent, fee-based financial planner can research the whole of the market and recommend the most suitable solution for a client’s needs.

Q. How do I save enough for retirement?

A. Having enough for retirement means different thing for different people. The first part is to think about what would be enough for you not only financially but enough in terms of the way you want to live your life. A Life-centred financial planner can help you make a plan to define and then reach your ‘enough’.

Q. How much will it cost to pay for my children’s university?

A In some countries (especially in Europe) university is free or subsidised, but in the UK, USA and Australia this isn’t the case. The average cost of university in the UK costs approximately USD30,000 per year. In Australia, around USD39,000-43,000 per year. The US is by far the most expensive with costs ranging from USD61,500-90,3000 per year.

Q. Should I retire in Asia or Europe?

A. The ideal retirement location will depend much on your personal interests and preferences. However, there are some practical things to consider. Lower cost of living and lower taxes will of course make your retirement savings last longer. But consider a location that ensures you are living the life you want in terms of relationships, interests and happiness.

Q. Do I need life insurance?

A. If something unexpected were to happen to you today, would you be able to leave your loved ones in the financial position you would want to? Ensuring that you and your loved ones are protected should be the foundation of any financial plan before thinking about saving and investing.

Q. What is the difference between Whole of Life and Term insurance?

A. Term Insurance limits the cover to a specific period, i.e 10 or 20 years. Whole Of Life provides cover for the entirety of your life. Term insurance is a simple “pure insurance”, whereas Whole Of Life often includes a savings/investment/bonus element. It is important to consult a professional to help determine what type of plan is best for you.

Q. What is covered on Critical Illness insurance?

The illnesses covered in a critical illness policy can vary based between different insurers. The illnesses most people worry about such as Cancer, a Heart Attack or a Stroke would be covered, but it is important to understand the full range of cover before taking out a policy, especially if there is a specific concern you wish to protect against.

Q. What is the difference between Critical Illness and Medical insurance?

A. Private Medical Insurance is designed to cover the cost of diagnosis, treatment, medicine and care in a private medical clinic or hospital. Critical Illness insurance will pay you a lump sum (of your pre-determined cover) which might be used for medical costs, but is normally used to replace loss of income and the financial impact to the household in the event of being unable to work due to illness.

Q. What is a better investment, property or the stock market?

A. Property and the stock market have proven be consistent wealth builders over time. Whether one is better than the other will depend on your personal attitude to investment. Diversification by geography and asset class has proven to be a sensible strategy. Pyrmont’s LifePlan process aims to give an objective view of your financial life regardless of which assets you own.

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