Advisers need to look past zeros
Financial advisers who do not understand their client’s health and lifestyle is failing them, Leading Advice believes.
The financial planning firm said advisers needed to know their clients’ mental and physical health almost as intimately as their doctor and could not ever provide truly effective planning and wealth protection strategies if they did not.
Leading Advice’s managing director and financial adviser, Katrina Haskew, said a client’s health could determine which financial strategies could actually be followed and what was not feasible.
“There’s no point formulating an aggressive expansion strategy for a business owner who is burnt out, not sleeping, and slowly developing a heart condition from stress and a lack of exercise and healthy eating,” she said.
“This is a recipe for absolute disaster, and could lead to financial ruin when things inevitably spiral out of control.”
Haskew said wealth protection strategies could be formulated by knowing medical risk factors and lifestyle goals.
“The sooner we know this the better, because sometimes you can change your eligibility through minor lifestyle changes,” she said.
“Understanding your lifestyle goals can also help us choose between the myriad of insurance options.”
In preparing for retirement, Haskew said if advisers did not know how long a client would live they would not know how much they would need to save.
She said pre-existing diseases or conditions, social and familial support systems, a sense of purpose, access to health facilities would impact longevity after retirement.
“It’s no secret being physically and mentally healthy often equates to healthier finances,” Haskew said.
“Understanding your client’s health and lifestyle is integral to providing effective financial advice. Any adviser who is not doing this is absolutely failing their clients in my opinion.”
Recommended for you
The new financial year has got off to a strong start in adviser gains, helped by new entrants, after heavy losses sustained in June.
Michael McCorry, chief investment officer at BlackRock Australia, has detailed how investors are reconsidering their 60/40 portfolios as macro uncertainty highlight the benefits of liquid alternatives.
Having reset its market focus to high-net-worth advisers, Praemium’s administration solution has been selected by Bell Potter in a deal that increases the platform's funds under administration by $6 billion.
High transition rates from financial advisers have helped Netwealth’s funds under administration rise by $3.7 billion in the fourth quarter of FY25.
