If you pay a financial adviser in New Zealand for advice rather than a product, a Statement of Advice is usually the thing you are actually buying. It is the written plan: what to do, in what order, and why. Everything else an adviser does either leads up to it or carries it out.
People often reach this question at the point of deciding whether advice is worth paying for, and the honest answer depends on knowing what lands on your desk at the end. So here is what one contains.
What a Statement of Advice actually is
It is a written document, personalised to you, that brings every part of your financial life into one plan. It is not a product recommendation sheet and it is not a brochure. Its job is to set priorities and an action sequence: what to do first, what matters most, and how much to direct to each goal or asset type.
The reason it has to be written, and written for you specifically, is that the advice depends entirely on your circumstances. Two people with identical incomes can need opposite plans, because the thing that decides the answer is usually the debt, the timeframe or the tax setting rather than the income.
What is in one
The scope is agreed with you before the work starts, so no two are identical. The areas clients most often ask to have covered are:
- Goals and priorities, written down in an order you agree with.
- Cashflow structure and savings rules, so the plan survives a normal month rather than an ideal one.
- Debt strategy and repayment priorities, including which debt to attack first.
- Mortgage strategy and review points, and when to revisit them.
- Investment strategy and target allocations.
- KiwiSaver and retirement settings.
- Risk comfort and safeguards, so the plan matches what you can actually live with when markets fall.
- A clear action sequence, so you close the document knowing what happens next.
If something that matters to you is not on that list, it can be brought into scope. The list describes what people usually ask for, not a fixed menu.
What a Statement of Advice is not
It is not a disclosure statement. This is the most common mix-up, and searching for one often turns up the other. A disclosure statement is about the adviser: their licence, their fees, their conflicts of interest, and what to do if you have a complaint. You should read it, and ours is on our disclosure page. A Statement of Advice is about you, and it is the deliverable you are paying for.
It is not the implementation. The plan sets the strategy; putting it into effect is separate work, and separately priced. That separation is deliberate: it means you can take the plan and act on it yourself, with no obligation to keep paying anyone.
It is not a product sale. Where an adviser earns commission from a product provider, the recommendation and the payment point at the same place. We receive no commissions and no product incentives, which is why the advice is the product here.
What you own at the end
You own the document. It is yours whether or not you continue with the adviser who wrote it, and it remains useful because it explains the reasoning and not only the conclusions. A plan that says what to do without saying why cannot be re-applied when your circumstances change, and they will.
That also makes it the right thing to ask for when you are comparing advisers. Ask what their written advice contains, whether implementation is included or separate, and whether they are paid by anyone other than you.
How much a Statement of Advice costs
Fees are agreed with you in writing before any work begins, based on the scope you settle on together. That matters more than a headline number: a plan covering a mortgage, a portfolio and a retirement timeline is a different piece of work from one answering a single question, and quoting one price for both would be a fiction.
Ours is a fixed fee of NZD 950, GST inclusive, paid once, for a scope agreed in writing before any chargeable work starts. The full structure, including implementation, the free first consultation and what happens if the plan does not identify enough value to be worth it, is set out on what a financial adviser costs in New Zealand.
What you should insist on, from any adviser, is the number in writing before the work starts, and a clear statement of whether anyone else is paying them. Ask both. A straight answer to the second one tells you most of what you need to know.
Is it worth it?
It is worth it when the decisions in front of you are large relative to what you have, when they interact with each other, or when getting the order wrong is expensive. Paying down a mortgage while contributing to the wrong fund, or investing before fixing a tax setting, are the sort of mistakes a plan prevents and a product cannot.
If you are not sure whether your situation warrants it, say so. A first consultation is free, carries no obligation, and part of its purpose is to tell you honestly if paying for a full plan would not change your answer.
Related
VIS.finance™ is a licensed Financial Advice Provider (FSP1010421). This page is general information, not personalised financial advice.
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