Finding a trustworthy financial adviser after loss

At some point in the months after your partner has died, you will probably need financial advice. The estate may have been wound up, but what comes next -- managing assets on a single income, restructuring investments, planning for your own future -- often needs professional guidance.

Getting that guidance from the right person matters. This guide will help you find an adviser you can trust and avoid the ones you can't.

When is the right time to see a financial adviser?

There is no single right time, but there are some wrong times.

The first few weeks and months after a death are not ideal for making major financial decisions. Your capacity to assess information and weigh options is genuinely reduced by grief. Established research into decision-making after bereavement supports this.

That said, some decisions can't wait. If there is an urgent financial matter -- a large sum of money sitting in cash, a property that needs managing, a business interest that requires attention -- you may need to act sooner than feels comfortable.

A reasonable approach is to avoid any decisions that are not urgent in the first three to six months. For everything else, give yourself time.

If an adviser is pushing you to make major decisions quickly, that is a warning sign.

What kind of financial adviser do you need?

Financial advice in Australia is provided by a range of people with different qualifications, licences, and areas of focus.

For most bereaved partners, the most relevant type is a licensed financial adviser who is authorised to provide personal advice. "Personal advice" means they take your individual circumstances into account, not just your general situation. This is legally distinct from general advice, which does not consider your specific needs.

Within this category, you may want someone who specifically has experience working with:

• People who have recently been bereaved
• Estate proceeds and inheritance
• Superannuation death benefits
• Single-income households

Ask about this experience directly. An adviser who has worked with bereaved clients before will understand that the process may be slower and more sensitive than a standard engagement.

How do you find candidates for a financial adviser?

Start with trusted referrals. Ask your solicitor, accountant, or GP if they know a financial adviser they would recommend to someone in your situation. These professionals often have professional relationships with advisers whose work they've observed.

The Financial Advice Association Australia (FAAA) has a public register and a "find an adviser" tool at faaa.au.

The Moneysmart website (run by ASIC) also has a register of licensed advisers and a tool for checking an adviser's credentials and history at moneysmart.gov.au.

Once you have a few names, check each adviser on the ASIC Financial Services Register (available through Moneysmart). This confirms they hold a current licence and shows any disciplinary actions on record.

What questions should you ask in the first meeting?

The first meeting with a financial adviser should be free. Use it to assess them, not to make decisions.

Questions worth asking:

• Are you a licensed financial adviser? Can I see your Australian Financial Services licence number?
• What is your fee structure? Do you receive any commissions or payments from product providers?
• Have you worked with recently bereaved clients before?
• What would a typical engagement with you look like?
• How do you communicate -- by email, phone, in person?
• What happens if I want to end the arrangement?

Pay attention to how they answer as much as what they say. An adviser who listens, explains things clearly, and doesn't rush you is more valuable than one who has an impressive-looking portfolio.

What fee structures should you understand?

Since 2013, Australian financial advisers are no longer permitted to receive commissions on investment and superannuation products. But the structure of fees still varies significantly between advisers.

Common fee arrangements include:

• Fixed fees for specific pieces of advice (a statement of advice, a review)
• Percentage of assets under management (an ongoing annual fee calculated as a percentage of your investments)
• Hourly fees for time spent

Understand what you will pay before engaging anyone. Ask for a fee disclosure statement and read it.

Be cautious of any arrangement where the adviser benefits financially from recommending specific products. While commissions on super and investments are banned, some products (such as insurance) still allow commission arrangements. Ask about this specifically.

What are the warning signs of a poor financial adviser?

Trust your instincts if something feels wrong. Specific warning signs include:

• Pressure to make decisions quickly, especially in the first few meetings
• Recommendations to move large sums of money into products you don't understand
• Reluctance to explain fees in plain language
• Being dismissive of your questions or treating them as basic
• Claims that their approach offers guaranteed returns
• Being contacted unsolicited by someone offering to "help" with your inheritance

If you feel pressured, you can always say you need more time. A good adviser will support that. Anyone who doesn't is not someone you should be working with.

What is the difference between a financial adviser and a financial counsellor?

Financial counsellors are different from financial advisers. They provide free, independent support to people experiencing financial difficulty and are funded by government or community organisations.

If your situation is more about managing debt or covering immediate expenses than investing or planning, a financial counsellor may be more useful right now than a financial adviser.

The National Debt Helpline (1800 007 007) can connect you with a free financial counsellor.

Do you have to decide everything at once?

A good financial adviser will understand that your situation is evolving. You don't need to have a fully formed plan in the first meeting, or the second.

The goal for now is to find someone you trust, understand your current financial position, and make sure no urgent decisions go unaddressed. Everything else can develop at a pace that works for you.