financial product advice
You are a financial planner for EANWB Financial Planning and authorised to provide financial product advice on a range of investments (excluding direct shares), superannuation and retirement planning, and insurance and risk protection. You are also able to provide taxation information that is incidental to the advice provided. In other words, you can provide information about any potential tax savings or tax benefits that could result from your recommendations, but you must refer the client to a tax professional for specific tax advice. You do not have the authority to provide estate planning or property advice and you must refer clients to suitable professionals should you identify they need advice in areas for which you have not been appropriately authorised and trained. (Refer to the sample SOA and the wording used regarding tax, estate planning and real estate, as well as the summary of what advice areas are covered, and what are not, at the beginning of the sample SOA.) Section 1: Meeting your client The first phone call Jessica Bigge has agreed to speak with you following a suggestion made to her by her bank’s personal lending officer who knows you and is respectful of the quality advice you provide to your clients. She was in the process of successfully organising a loan to purchase her car at the time. Jessica is unsure of what is involved in personal financial planning, but concedes that planning for her future financial objectives could be of value. She agrees to have her contact details passed on to you by the bank’s lending officer so that you can tell her about what is involved in the financial planning process, what the possible benefits might be to her, and costs involved. When you phone Jessica, you provide her with details about the financial planning process, and why you will need to ask her for certain types of financial information. You stress that you work for a licensee (a person authorised by the Government to deal in financial products) and any information she gives you will be treated confidentially. You let her know that this information will only be used to provide the financial advice you consider will meet her needs. You tell her all this information is in the Financial Services Guide (FSG) that you will send her. Jessica is reassured by your introduction so you proceed. You explain you need her to contribute to the compilation of a financial profile in order to help you work out how she can best meet her financial goals. This means that she will need to tell you what she owns, what she owes, what she earns and her living expenses. She can record all this information in the fact finder you will send her with the FSG. You inform Jessica that the fact finder also includes a risk profile section and the information she provides you will give you sense of her appetite for different financial planning strategies. You make a date and time with Jessica to come to your office and take down her address and phone numbers. You ask Jessica to bring along to the meeting her completed fact finder and as much financial information as she can, such as income details, expenses, superannuation, insurance details, etc. When you have concluded the call, you make a file note about the conversation including the date, the potential client’s name, and the name of the person who referred her to you. This is the start of your paper trail. You also complete some of the initial details in your data collection form so that it looks like Table 1. Finally you write to Jessica, as promised during your initial conversation, and include the fact finder, the FSG and a checklist of the information she needs to bring to the meeting.