Top 7 reasons why you need a financial planner

financial planner adelaide

Life is busier than ever before and with so many things to get done, it can be easy to put off finding a good financial planner.

However, the ‘maybe later’ approach will eventually catch up with you and have a significant impact on your future.

In this blog, we explain seven ways a financial planner can put you on the path to the life you want and the legacy you deserve.

1: Setting a budget and managing your cash flow

Many of us have set out with the best intentions to create a household budget in the hope of finally getting ahead.

In theory, it all sounds quite easy – spend less than you earn and use the rest for savings and investments.

However, there are always unforeseen life events that get in the way. For example, an unexpectedly large electricity bill, a trip to the vet for your pet, or that must-have expensive Christmas gift for a member of your family.

A financial planner can offer expert tips to better ensure you’re prepared for these surprises and can teach you to grow your overall wealth.

2: Managing your tax obligations

When working hard and pouring your money into investments, the last thing you want is to lose a big chunk of it in tax, especially when you don’t have to! 

Working with your accountant, a financial planner will ensure your financial assets are structured in the most appropriate way to minimise your tax liability. This factors in things like superannuation, family and discretionary trusts, private and public companies as well as individual and joint business names.

A financial planner can also provide advice around negative gearing and salary sacrificing.

3: Managing your debt

Australians are among the most indebted people in the world and many don’t know how to break free.

A financial planner can help you build a strategy for managing your debt, whether it be in any of the following forms:

  • Mortgage debt
  • Business debt
  • Education loans (HECS)
  • Investment loans
  • Credit card debt
  • Personal loans
  • Self-managed super fund (SMSF) loans

A financial planner can also help educate you on the difference between ‘good’ and ‘bad’ debt and explain why ‘good’ debt can actually help you in the long run.

4: Retirement planning

The thought of retirement often induces a lot of fear. 

You’re already working so hard to keep on top of your financial obligations today, how could you continue to provide for your family and enjoy your lifestyle without a working wage to rely on?

With expert help from a financial planner, you can put a plan in place that will position you for independence and retirement, whilst securing your family’s future. 

Retirement might feel a while away, but the sooner you start preparing the better off you’ll be. 

A financial planner can help to define ‘life after work’, and build a plan to get there.

5: Strategic estate planning

When you think about the legacy you want to leave, what does it look like? 

A financial planner can give advice on how to make sure you can continue to protect and provide for your loved ones, even when you’re gone.

Relationship dynamics and tax implications can make this process complex, but with the right advice you can reach an outcome that satisfies you and your family.

While many people have typically been casual about the estate planning conversation, or avoided it entirely, it has never been more important to get your house in order. 

6: Financial education

For most people, financial concepts and strategies can be difficult to grasp. 

A financial planner has the ability to teach you – and importantly, your children – the basics, thereby setting your entire family up for a strong financial future. 

In the event you pass away, your children (or other close family members) will likely need to arrange the transfer of your wealth and understand the impact on each of them personally. 

Your financial planner can facilitate this process.

7: Connecting you with experts

Financial planners are often well connected with other professionals who can help you secure your future, such as accountants, solicitors and mortgage brokers.

The team at Heard Financial is experienced at bringing all of those specialists together to help you develop a strong plan, which factors in everything mentioned in this article.

For a no obligation discussion about your financial planning needs, contact us today. 

This information may be regarded as general advice. That is, your personal objectives, needs or financial situations were not taken into account when preparing this information.

Accordingly, you should consider the appropriateness of any general advice we have given you, having regard to your own objectives, financial situation and needs before acting on it. Where the information relates to a particular financial product, you should obtain and consider the relevant product disclosure statement before making any decision to purchase that financial product.

Ethical Investing: Types, Pros and Cons

Ethical investing has been gaining prominence over the last few decades. Find out what makes it an attractive investment strategy in this post.


Ethical Investing: Types, Pros and Cons

The investment technique known as ethical investing prioritises the investor’s moral, religious and social ideals over financial gain. The reason for this is that a growing number of investors have begun to demand social responsibility from the companies they invest in, primarily because of the rise in dubious and unlawful investment arrangements.

Ethical investing entails fair labour practices, the production of healthy and beneficial goods and services, and abstaining from unethical business activities.

Investors who want to utilise their money to support good causes should consider ethical investment. Those who are interested in this type of venture have several options to choose from.


Types of Ethical Investments

Below is a list of the different types of ethical investments:

1. Environmental, Social and Governance Funds (ESG Funds)

ESG investment strategies target shares in businesses that follow good corporate, social and environmental practices. ESG funds take into account the potential effects that environmental, social and governance factors may have on a company’s performance when making investment decisions.

2. Faith-Based Funds

Faith-based funds (aka morally or biblically responsible, or faith-driven funds) only own stocks that uphold certain religious principles and values. This family of mutual funds rigorously avoids investments that do not match that category. They wouldn’t invest in companies involved with alcohol, anti-family entertainment, gambling, tobacco and similar potentially offensive practices.

3. Impact Funds

Impact investing is a term used to describe an investment approach where ethical improvements or positive results for the community and environment take precedence over fund performance or financial returns. Examples of this include investing in non-profits or businesses producing or using clean technology.

4. Socially Responsible Investing Funds (SRI Funds)

Socially responsible investing entails eschewing investments in contentious industries or companies that manufacture or provide addictive substances or activities or whose products or services go against the principles of social justice, sustainability and clean technology. This is why SRI funds steer clear of businesses involved in gambling, guns and ammunition, tobacco, alcohol and oil.

Pros and Cons of Ethical Investing

Whether you want to start ethical investing in Australia or elsewhere, it’s important to be aware of its pros and cons, so you know exactly what to expect.


  • When an ethical holding company performs well, the investor benefits financially and emotionally as the business shares their ideals.
  • Investments in ethical funds have a great potential to increase dramatically as more people become aware of them.
  • The growing relevance and popularity of ethical investing will motivate other companies to raise the bar on their ethical standards in order to attract investors.


  • It takes a lot of investigation or due diligence to verify that investing in a business is in line with the investor’s values and views because it is not a passive strategy.
  • Since ethical investment may not offer the best returns, the investor may need to forgo financial benefits in favour of upholding their ethical philosophy.
  • More work and research goes into finding the right investment, so the costs for ethical investing can be higher compared to conventional investments.

That being said, the number of investors who want to make a positive impact on the society and environment is expected to continue growing.

If this article has inspired you to think about your own unique situation and, more importantly, what you and your family are going through right now, please contact your advice professional.

(Feedsy Exclusive)

Superannuation scams – What to do about super scams

If someone offers to withdraw your super or move it to a self-managed super fund (SMSF) so you can access the money, it’s probably a scam.

Learn how to spot a superannuation scam, and where to report it.

How to spot a super scam

Scammers can target you online, by phone or by email.

Signs of a super scam:

  • advertisements promoting early access to super
  • offers to ‘take control’ of your super
  • offers to invest your super in property
  • offers of quick and easy ways to access or ‘unlock’ super

Phishing scams for your super

Watch out for emails or calls requesting your personal or account details. Scammers may pretend to be a company you know, like your super fund, to steal your identity. They may then use this to transfer your super to an account they can access, like a fake SMSF.

Report a super scam

If you think you’ve been targeted by someone who is trying to access your super early, report it to:

Support after a scam

If a scam has caused you problems with debt, talk to a financial counsellor. They can help you get your finances back on track.

If you’ve been scammed and need someone to talk to, contact:

Protect yourself from super scams

There are some simple things you can do to protect yourself from super scams.

Know the rules about your super

Scammers will try to convince you that they can help you to get your super early. Knowing when you can legally get your super protects you from these kinds of scams.

See getting your super.

Check your balance and contact details

Regularly check your super balance by logging into your account through your super fund’s website. If something doesn’t look right, contact your super fund and ask them to explain.

Make sure your super fund has your correct mobile number, email and postal address. This will help them get in touch with you if there’s any suspicious activity on your account.

Take steps to stop identity theft

There are simple steps you can take to help stop someone stealing your identity — for example, shredding your documents, and being careful on social media. See identity theft.

Don’t deal with anyone who is not licensed

A scammer will not have a licence to set up or manage super funds. You can check if someone is licensed on ASIC’s website. Choose ‘Australian Financial Services Licensee’ in the drop-down menu when you search. You can also use APRA’s Disqualification Register to check whether someone has been disqualified.


Booms, busts and investor psychology – why investors need to be aware of the psychology of investing

Key points

  • Investment markets are driven by more than just fundamentals. Investor psychology plays a huge role and helps explain why asset prices go through periodic booms and busts.
  • The key for investors is to be aware of the role of investor psychology and its influence on their own thinking. The best defence is to be aware of past market cycles (so nothing comes as a surprise) and to avoid being sucked into booms and spat out during busts. If an investor is looking to trade they should do so on a contrarian basis. This means accumulating when the crowd is panicking, lightening off when it is euphoric.



Up until the 1980s the dominant theory was that financial markets were efficient – in other words all relevant information was reflected in asset prices in a rational manner. While some think it was the Global Financial Crisis that caused faith in the so-called Efficient Markets Hypothesis (EMH) to begin unravelling, this actually occurred in the 1980s. In fact, it was the October 1987 crash that drove the nail in the coffin of the EMH as it was impossible to explain why US shares fell over 30% and Australian shares fell 50% in a two-month period when there was very little in the way of new information to justify such a move. It’s also hard to explain the 80% slump in the tech heavy Nasdaq index between 2000 and 2002 on the basis of just fundamentals. Study after study has shown share market volatility is too high to be explained by investment fundamentals alone. Something else is at play, & that is investor psychology.

Investor psychology

Several aspects of investor psychology interact in helping drive bull and bear phases in investment markets, including individual lapses of logic and crowd psychology.

Individuals are not rational

Numerous studies by psychologists have shown that – apart from me and you! – people are not always rational and tend to suffer from various lapses of logic. The most significant examples are as follows.

  • Extrapolating the present into the future – people tend to downplay uncertainty and assume recent trends, whether good or bad, will continue.
  • Giving more weight to recent spectacular or personal experiences in assessing the probability of events occurring. This results in an emotional involvement with an investment strategy – if an investor has experienced a winning investment lately he or she is likely to expect that it will remain so. Once a bubble gets underway, investors’ emotional commitment to it continuing steadily rises, thus helping to perpetuate it.
  • Overconfidence – people tend to be overconfident in their own investment abilities.
  • Too slow in adjusting expectations – people tend to be overly conservative in adjusting their expectations to new information and do so slowly over time. This partly reflects what is called “anchoring” where people latch on to the first piece of inflation they come across and regard it as the norm. This partly explains why bubbles and crashes in share markets normally unfold over long periods.
  • Selective use of information – people tend to ignore information that conflicts with their views. In other words, they make their own reality and give more weight to information that confirms their views. This again helps to perpetuate a bubble once it gets underway.
  • Wishful thinking – people tend to require less information to predict a desirable event than an undesirable one. Hence, asset price bubbles normally precede crashes.
  • Myopic loss aversion – people tend to dislike losing money more than they like gaining it. Various experiments have found that a potential gain must be twice the potential loss before an investor will consider accepting the risk. An aversion to any loss probably explains why shares traditionally are able to provide a relatively high return (or risk premium) relative to “safer” assets like cash or bonds.The madness of crowds
    As if individual irrationality is not enough, it tends to get magnified and reinforced by “crowd psychology”. Investment markets have long been considered as providing examples of crowd psychology at work. Collective behaviour in investment markets requires the presence of several things:
  • a means where behaviour can be contagious – mass communication with the proliferation of electronic media are a perfect example of this. More than ever, investors are drawing their information from the same sources, which in turn results in an ever-increasing correlation of views amongst investors, thus reinforcing trends;
  • pressure for conformity – interaction with friends, monthly performance comparisons, industry standards and benchmarking, can result in “herding” amongst investors;
  • a precipitating event or displacement that gives rise to a general belief that motivates investors. The IT revolution of the late 1990s, the growth in China in the 2000s and crypto currencies more recently are classic examples of this on the positive side. The demise of Lehman Brothers and problems with some crypto currencies/markets are examples of displacements on the negative side; and
  • a general belief which grows and spreads – eg, share prices can only go up – this helps reinforce the trend set off by the initial displacement.

Bubbles and busts

The combination of lapses of logic by individuals in making investment decisions being magnified by crowd psychology go a long way to explaining why speculative surges in asset prices develop (usually after some good news) and how they feed on themselves (as individuals project recent price gains into the future, exercise “wishful thinking” & get positive feedback via the media, their friends, etc). Of course, the whole process goes into reverse once buying is exhausted, often triggered by contrary news to that which drove the rise initially.

Investor psychology through a market cycle looks like what Russell Investments called the roller coaster of investor emotion. When times are good, investors move from optimism to excitement, and eventually euphoria as an investment’s price – be it shares, housing, gold, cryptos or whatever – moves higher and higher. So by the time the market tops out investors as group are maximum bullish and fully invested, often with no one left to buy. This ultimately sets the scene for a bit of bad news to push prices lower. As selling intensifies and prices fall further, investor emotion goes from anxiety to desperation, and eventually capitulation and depression. By the time the market bottoms out investors are maximum bearish and many are out of the market. This then sets the scene for the market to bottom as it only requires a bit of good news (or less bad news) to bring back buying, and then the cycle repeats.

The roller coaster of investor emotion through a mkt cycle

Source: Russell Investments, AMP
Source: Russell Investments, AMP

This pattern has been repeated time again over the years: in the early/mid 1990s with emerging markets; the late 1990s tech boom; late 2000s with the focus on credit, US housing; and arguably more recently with crypto currencies and yield plays.

Points to note

Firstly, confidence and investor psychology do not act in a vacuum. The move from depression at the bottom of a cycle to euphoria at the top is usually underpinned by fundamental developments, e.g., strong economic growth and easy money.

Second, at market extremes confidence is best read in a contrarian fashion – major bull markets do not start when investors are feeling euphoric and major bear markets do not start when they are depressed. By the time investor confidence has reached these extremes, all those who wish to buy (or sell) have done so meaning it only requires a small amount of bad news (or good news) to tip investors the other way. So extreme low points in confidence are often associated with market bottoms, and vice versa for extreme highs.

Third, ideally one needs to look at what investors are thinking (sentiment) and what they are actually doing (positioning).

Finally, negative crowd sentiment at market bottoms can tend to be associated fairly quickly with market bottoms reflecting the steep declines associated with panics as a market falls. But during bull markets positive sentiment or even euphoria can tend to persist for a while as it takes investors longer to build exposures to assets than to sell them.

So where are we now in relation to shares?

The next charts shows the US share markets and a measure of US investor sentiment that includes surveys of investment newsletter writers and individual investors and the ratio of puts (options to sell shares) to calls (options to buy). It shows that extreme levels of pessimism tend to be associated with major market bottoms (indicated by the green arrows) and extreme measures of optimism tend to be associated with market tops (red arrows) although, as noted above, sentiment can be less reliable at tops.

Currently, the high levels of optimism seen last year are long gone after the plunge in shares, which left sentiment very negative and now sentiment is still negative but not extreme. If anything, this is mildly bullish from a contrarian perspective but after the rally since June it’s not a strong signal either way.

Source: Bloomberg, Sentimentrader, Investors Intelligence, AMP
Source: Bloomberg, Sentimentrader, Investors Intelligence, AMP

What does this mean for investors?

There are several implications for investors.

  • First, recognise that investment markets are not only driven by fundamentals, but also by the often-irrational and erratic behaviour of an unstable crowd of investors. The key here is to be aware of past market booms and busts, so that when they arise in the future you understand them and do not overreact (piling into unstable bubbles near the top or selling everything during busts and locking in a loss at the bottom).
  • Second, try and recognise your own emotional responses. In other words, be aware of how you are influenced by lapses in your own logic and crowd influences like those noted above. For example, you could ask yourself: “am I highly affected by recent developments? Am I too confident in my expectations? Can I bear a paper loss?”
  • Thirdly, to guard against emotional responses choose an investment strategy which can withstand inevitable crises whilst remaining consistent with your financial objectives and risk tolerance. Then stick to this even when surging share prices tempt you into a more aggressive approach, or when plunging values suck you into a defensive approach.
  • Fourthly, if you are tempted to trade, do so on a contrarian basis. Buy when the crowd is bearish, sell when it is bullish. Extremes of bullishness often signal eventual market tops, and extremes of bearishness often signal bottoms. Successful investing requires going against the crowd at extremes. Various investor sentiment and positioning surveys can help. But also recognise contrarian investing is not fool-proof – just because the crowd looks irrationally bullish (or bearish) doesn’t mean it can’t get more so.

Shane Oliver, Head of Investment Strategy & Chief Economist