Questions to Ask Your Financial Adviser Before Signing an SOA

1. Why This Product Over Others?

Ask your adviser to explain why the recommended product or strategy was chosen over alternatives. A good SOA should already show this reasoning, but if it's unclear, ask directly. Under the best interests duty, your adviser must consider other options and choose what is right for you.

2. What Are All the Fees and Costs?

Get a complete picture of what you will pay — upfront fees, ongoing fees, commissions, and any exit costs. Ask for a simple breakdown in dollar terms, not just percentages. If anything is unclear, keep asking until you understand exactly where your money is going.

3. How Does This Advice Fit My Goals?

Does the advice match the goals you discussed with your adviser? If you talked about retiring at 60 but the plan is built around a 65-year retirement, ask why. The advice should be tailored to your stated objectives, not a generic template.

4. What Are the Risks?

Every financial decision involves some level of risk. Ask your adviser to explain the downside scenarios — what happens if the market drops, if you lose your job, or if your circumstances change. The SOA should address these risks, but it is worth discussing them face to face.

5. What Happens If I Say No?

Ask what happens if you decide not to proceed with some or all of the recommendations. Are there any penalties? Can you take parts of the advice and leave others? A good adviser will walk you through your options without pressure.

6. How Will You Review My Progress?

If the advice includes ongoing service, ask how often your situation will be reviewed, what those reviews will cover, and what they cost. Ongoing fee arrangements must be renewed annually, and you have the right to opt out at any time.

Questions About Qualifications and Experience

Before engaging an adviser, ask: What qualifications do you hold? Have you passed the FASEA exam? How many years of experience do you have in financial advice? What areas do you specialise in? Do you have experience with clients in similar situations to mine?

Also ask: Are you an independent adviser or aligned with a specific institution? Do you have access to products from the whole market or a restricted range? What is your AFSL number?

Questions About Fees and Services

Ask: What is your fee structure? How much will the initial advice cost? What are your ongoing fees and what services do they cover? Are there any additional costs I should be aware of? How are you paid (fee-for-service, commissions, asset-based fees)?

Also ask: What services are included in the ongoing fee? How often will we meet? Can I terminate the arrangement at any time? What happens to prepaid fees if I terminate early? Do you receive any commissions or benefits from product providers?

Questions About Complaints and Disputes

Ask: What is your complaints process? Who is your external dispute resolution scheme (should be AFCA)? What happens if I am unhappy with the advice? Do you have professional indemnity insurance? What compensation arrangements are in place if something goes wrong?

A good adviser will have clear, documented answers to all these questions. If an adviser is evasive or unwilling to provide written information, consider this a warning sign.

Frequently Asked Questions

Should I get everything in writing?
Yes. Verbal agreements are difficult to enforce. Ensure fees, services, and terms are documented in your ongoing service agreement or SOA.

What if my adviser cannot answer my questions?
This is a warning sign. A competent adviser should be able to answer all reasonable questions. Consider finding a different adviser.

Can I change my mind after signing?
Yes. You can terminate an ongoing service agreement at any time. Most products have a 14-day cooling-off period. You are not obligated to implement advice.

Should I ask for references?
Asking for client references is reasonable, though some advisers may not provide them due to privacy reasons. The Financial Advisers Register provides information about the adviser's history.

What Financial Advice Typically Costs

What does advice cost in practice? The typical ongoing fee sits around $4,700–$4,800 a year — a figure that has climbed 67% in five years, though annual growth has cooled to roughly 4%. Starting out, expect an initial Statement of Advice to be priced between $2,000 and $3,500, with specialist hourly rates anywhere from $300 to $600. Since FOFA banned commissions on investment advice, fee-for-service billing has become the norm.

Questions About the Advice Process

Beyond the basic questions about fees and qualifications, ask your adviser about their process. How will they gather information about your financial situation? Will they provide a fact find document for you to complete? How many alternative strategies or products will they consider before making a recommendation? How will they present their recommendations — will you receive a full SOA, a Record of Advice, or a shorter advice document? Understanding the process upfront helps you know what to expect and when to expect it.

Ask how the adviser handles conflicts of interest. While FOFA bans conflicted remuneration, some conflicts may still exist — for example, an adviser who works for a licensee that owns a platform may have a business incentive to recommend that platform. The adviser should disclose any such conflicts in writing and explain how they ensure your interests come first. If the adviser is evasive about conflicts, that is a significant red flag.

Questions About Ongoing Service

If the adviser recommends an ongoing fee arrangement, ask specific questions about what you will receive for those fees. How often will you meet (quarterly, semi-annually, annually)? What will each meeting cover? Will you receive written updates or just verbal reports? Who will be your main contact — the adviser or a paraplanner? What happens if your circumstances change between scheduled meetings — can you request an interim review? Under the DBFO reforms, ongoing fee arrangements now require annual client consent, so you should also ask when consent will be obtained and what happens if you decide not to renew.

Also ask about the exit process. If you decide to stop paying ongoing fees, what happens? Can you take your investments with you (i.e., are they held on a platform that you can retain)? Will the adviser provide a final statement of your position? Is there any exit fee? Understanding these details before signing an ongoing service agreement helps avoid surprises later.