Top 5 Tips For An Australian Expat Choosing A Financial Adviser – managing your finances as an Australian resident can be complicated but as soon as you step on that plane and move overseas the complexity takes a new level as you not only learn about how the move overseas financially affects your Australian assets but also any new rules and regulations that you have to take into consideration in your new adopted country.
Working with a expat financial adviser can make the process a lot easier however not all financial advisers can provide advice to expats and not all expat financial advisers can provide appropriate advice to Australian expats.
We have provided below our top 5 tips that Australian expats should consider when selecting a financial adviser.
1.Are They Licensed? – When an Australian expat is considering engaging a financial adviser it may seem simplistic but the first thing you need to research is whether they are licensed. You would be surprised how many “Financial advisors” in Asia and the Middle East have little to no licensing. What this means is that they aren’t held to any internationally recognised regulatory standard and in turn you have no protection or recourse should the advice that they provide to you be inappropriate or illegal.
So where should the financial adviser be licensed? It may seem obvious but the answer is Australia. The reason being is that only an Australian licensed financial adviser will fully understand concepts that are important to you as both an Australian expat and a Australian citizen e.g superannuation, ATO tax rules, repatriation strategies etc.
In order to determine whether the adviser you are speaking to is licensed in Australia the Australian Securities & Investments Commission (ASIC) maintains a Financial Adviser Register that lists all financial advisers who are licensed and accredited with ASIC. To view the register click here.
If the adviser is British, American, South African or any other nationality its best to steer clear of them. We are sure they are nice guys and girls however they do not maintain the licensing and most importantly don’t have the experience and understanding in order to deliver Australian expat financial advice. Even if they are appropriately licensed offshore the financial advice they provide may only be suitable (if at all) for the time in your current country however long or short that may be.
2.Does Their Licensee Allow Them To Provide Financial Advice to Australian Expats? – Now that you have researched whether the financial adviser you are looking to engage is appropriately licensed in Australia the next step is to determine whether their licensee allows them to work with Australian expats. A Licensee holds a Australian Financial Services License (AFSL) from ASIC and each financial adviser on the register operates under a AFSL.
Due to the complex nature of providing Australian expat financial advice and the rapidly moving parts that go with it, a lot of licensee’s don’t allow Australian financial advisers to work with Australian expats. They restrict their advisers to only working Australian citizens who are resident in Australia.
In the past we have seen financial advisers ask Australian expats to sign a Power of Attorney (POA) appointing a friend or family member as their Australian point of reference to circumvent these restrictions. If you are asked to do this you need to question why am I paying ongoing fees to an adviser who can’t/won’t talk to me.
3.Are They “Match Fit” When It Comes To Australian Expat Financial Advice? – So you’ve determined that the adviser you are considering is on the Financial Adviser Register and that their licensee allows them to provide financial advice to Australian expats. The next step is are they “match fit”? By this we mean how often do they provide Australian expat financial advice.
If its a couple of times a year then they are not operating in this space enough to keep track of all of the respective changes, both in Australia and overseas. We would even go so far as saying if you are not doing this on a weekly basis then you are out of touch, things change that quickly.
When providing cross border financial planning services it is two dimensional financial advice – the country that you live in and the country where your assets are held. If you are not taking into account both jurisdictions than your actions in one country may have dire financial ramifications in the other.
4.What Percentage Of Their Clients Are Australian Expats? – Another great tool that you can use to determine whether the financial adviser you are considering working with is capable is by asking what percentage of their clients are Australian expats. If its anything less than 60-70% then they are not a specialist and like we said in Tip 3, they may not be match fit.
The financial considerations of an Australian expat are completely different to that of a Australian retiree living on the coast so make sure the you are not being lumped into the same boat.
5.Do They Have The Tools & Resources To Deliver Ongoing International Advice? – as part of engaging an adviser to provide ongoing financial advice you need to make sure that they have the tools and resources to deliver this. A once a year check in call or a visit to their office when your back in Australia is not enough.
The rules and regulations are changing so rapidly for Australian expats that updates need to be provided as and when they occur. As a minimum you should be receiving in person meetings or digital video calls at least once per quarter with regular updates being provided every month or two between those meetings.
Remember – financial advice is not set and forget. It requires constant reviews and amendments to ensure that your goals and objectives are being met taking into account any legislative changes that affect Australian expats.
As you can see its not just a simple case of opening the digital Yellow Pages and picking the first person you see.
Australian expat financial advice is a complicated and specialised field and you don’t want to jeopardise your financial future on a financial adviser that isn’t licensed, authorised, experienced or capable in ensuring that you are making the most of your time overseas.