How Does Financial Advice Work?

Following on from the last webinar that we went through where we talked about, what's the financial planner actually do? This is a related topic, it's talking about what is how does financial planning actually work, it's a little bit different to the other professions. So, if you have a legal dispute, you're gonna see a lawyer, if you have a tax issue, you're gonna see an accountant, if you have a sore knee, you go and see a doctor.

Financial Planning is a little bit different. It's far more discretionary. People tend not to see a financial plan. And when there's a crisis, it tends to be more how do we improve things? How do we track things? How do we make our financial life better, and there is a framework and a process we follow through that. So we'll go through that today.

Some disclaimers, everything we talked about today is going to be general and factual in nature. That distinction will make a lot more sense a little bit later when we talk about what that actually means. Because those are two of the three types of advice that you deal with in financial advice. If there's any performance stuff, ignored, doesn't apply. And we are recording the video, it will be posted online, and we will be cutting it up for snippets as well to go on our social channels.

So few main areas I want to cover today. The first ones are the six steps of financial planning. And if you saw our last session, that's going to look pretty familiar. But we bring it back to what the different types of advice mean as well. I want to talk a little bit about financial planning is a very when it's done well and done properly. It's a very holistic endeavor. And it's based on four elements of people's lives, their needs, wants, speed bumps, and roadblocks. And then we'll talk about what the different types of advice are. And there are three types: there's factual information, general information and or general advice and personal advice. And they're very distinct, very important. You're aware of what those differences are. And hopefully, we'll have some time for questions at the end. So, if you're on our last webinar, if you've watched the recording for the last one, this will look familiar.

Financial Planning follows a six-step process. And broadly speaking, it's getting to know you, really getting to know your specific situation and what you're looking to do, preparing some advice around that presenting the advice and executing the advice. But Yellow Line is quite important. As you're going through the financial planning process. That line essentially delineates between when advice actually occurs. So everything to the left of that line steps 1-2-3, there is no financial advice given in those stages. Sometimes people may feel like there has been, but legally, professionally, structurally, there can't have been because we cannot give personal advice without knowing your personal circumstances. So that yellow line is very important.

But when we're talking about what the steps in the process are, its financial planning or financial advice is done well. It's a collaborative process. We work with our clients in partnership to help them build their best financial life. And as I mentioned in the last presentation, that's part of that is developing the strategic picture. But also making sure we clean up all the technical aspects below that as well. The first step into that process is working out whether or not we can actually help. So if you've been referred through to financial planner, because you know, you're paying too much tax, or you need to organize a will. The reality is I can't really help with those things. We can minimize tax, you know, you can borrow more money or spend more money or make less money, but realistically, an accountant is your best avenue for tax management advice.

For getting a will drafted, we will use an estate planning solicitor to do that. That's not really our area. So this initial call is very much on the phone 15 to 20 minutes, how can we help and working out whether or not we can. The good thing with a good financial advisor is if they can't help, they have no qualms in passing you to somebody that can or passing on the details of someone in their network. And I think kind of an underrecognized aspect of good financial advice is having somebody with that broad network of people to bring in part of it also is a good fit.

You know, I have a fairly distinct approach to advice and that can be quite different to what other people are looking for. You know, some people want somebody who's going to promise a lot of investment Alpha outperformance you know, we will give you the best performing portfolio. That's not how I operate. I can't make those promises. It's not an area that we work in. There might be somebody who is offering a very high-quality service where you know, you speak to them every three weeks and you have meetings all year and they really then hold your hand. That's not really how we work either. Some people we just don't gel with. So that's what this call is a really good opportunity for. We may not be a great fit. So we'll find your Been a solution. But if we are a good fit, then we'll talk about how we work. And that's the next webinar in this series is about how I as a financial planner, in the advice gallery, how we work and we get really specific then, presuming that we're all feeling pretty good after that, we will then send you an email with some background information around how we help links to our website to relevant sections, our Financial Services Guide, which has an important document, and a link to book a time for our first meeting.

Thet first meeting is our we call it an exploration meeting. Other people call it a discovery meeting. Either way, it's our first meeting. Ideally, it's in person, or can't always be the case where everybody's fairly remote now, but if it can be in person, it's great. And that's where we sit down, and we walk through where you are now. Now, what a lot of people have, I think a lot of advisors historically have done, they've taken that as a data gathering exercise, bringing your super statements, bringing you insurances bringing your bank accounts, we'll go through it all in the meeting. And that's what the first meeting is all about. Again, where we may not be a good fit, we're a little bit different. That first meeting, I don't want you to bring in any financial information. I don't want to know about your super fund, I don't really want to know about your budget, I don't really know or care about your investments. That first meeting is all about working out where you are now, financially, holistically.

And that starts way discussion around what are your fundamental needs, what, what costs, what obligations, what commitments do you need to meet every week, month, quarter, and year, as part of life, you know, you need to meet a mortgage payment, school fees, things like that. From there, we then start talking about your wants and aspirations. And these are things like, you know, the traditional one was I want to retire early, I want to retire at 60. Instead of 65. I want to be independent of the age pension. We're getting a lot more now when I want to retire at 50. And I want to know that looks like we want to take two years off so we can do the big lap with the kids in the caravan. We want to be able to travel back to our parents’ country or see our parents overseas every two years. These are big aspirations and they flow into bigger discussions. What kind of life do you want for your kids? What kind of life do you want for yourselves? How does life look in five years’ time when you look back on what needs to have happened for you to feel successful and happy.

So it's a very big discussion. And from there, we move on to the things that might get in the way. And I distinguish them in two ways, speed bumps and roadblocks. A speed bump is a temporary thing that could come along. This is a positive speed bump. But having kids having kids will slow down your earning capacity. They will distract you from these other things in life for a great reason. But it'll be a temporary distraction. Slowly your life will find a new balance and you'll be able to continue on roadblocks are a different matter. Roadblocks are a significant permanent obstruction that makes you have to go around them. It could be being diagnosed with a horrible illness, it could be experiencing redundancy, a really crummy time of life, a divorce, anything like that. So what we try to do in this conversation is we work out here's where you are, that's your needs, here's where you want to go, what's your wants, what could get in the way. And that's where we start talking.

Traditionally, advisors have talked about risk and protection and insurance but bigger than that. The point I want to make that this meeting is I will call it a non-diagnostic meeting. We will not have any answers for you in that meeting. You will not walk out of that meeting feeling like you've been given advice. It is a such a small phrase to use for the way these meetings go. But it's so got to know you time. So it's gonna be lots of questions, lots of discussion, lots of digression, but no answers.

Coming out of that though, I will go and prepare a proposal for you a little outline the services that I think will be most valuable for you. in touch to that will be a quote for the costs involved and a timeline for delivery. So that's the discovery aspect.

When you're happy with that. We move on to collecting the information we need. And this is where we start talking about that specific info. This is where we started finding out about your super fund, your spending habits, your income, data, birth kid’s details, kids, schools, assets, liabilities, all that sort of stuff. We go pretty granular with this because we need to have a really solid foundation of your understanding of your situation so we can give your personal advice.

There is a type of advice out there that is annoying. We call cookie cutter advice where every person in the assembly line gets the same type of advice. So 67-year-old retirees get all the same advice as a 24 year old grad. They get the same advice. And it's just madness because your situations are so different. So this is why we get really granular here. So we collect a lot of data. There are forms, there's phone calls, pulls their signatures, there's requests that we send. Now most of the people on this call will have been through the mortgage application process was one of the great brokers from the Loan Gallery.

The information we collect is very similar because we need to have a really clear perception of where you are now, the difference is that we don't really care how you are spending your money, we just need to know how you're doing, like where it's going.

And once that's done, we will then get into preparing the advice. So we have all the information we need. We've done the investigations now how do we actually improve things for you. So the first rule that we follow, and apologies to any clinicians watching this, but it's do no harm. So our advice cannot leave people in a worse situation. I want the worst outcome of working with us to be that you are in the same position you were in when you started. That's the worst outcome. So an example of this is I was speaking with somebody today, they're asking us to review their insurance arrangements, their life insurances, they did it three or four years ago, they don't know if it's too much if they still expensive if the insurers any good. So they want us to run our AI over it. Cool. But I did have to explain to them is that I'm quite reluctant to change insurance in that case, because you've been through the underwriting process by then which if anybody's done that is quite onerous, you have to provide for medical information, often blood tests, medical tests, you then have to give employment information, financial information, it's the last one I looked at, I think was something like 12 or 13 pages of forms. Then it's assessed by an underwriter. And they sign off on that because the insurer is on the hook as soon as they sign off on that for life. As long as you keep paying your premiums on a life insurance policy in Australia, you are guaranteed for that policy to renew every year. So it's a big commitment by the insurer. So you've been through that you've passed the gatekeeper, now you've got insurance cover. Now, if we recommend a change to a new policy, you have to go through that process all over again. And things might be discovered, you may have had a health event between now and then your occupation may have changed, things may have just changed. So it's possible that the new policy could be inferior, or could come with terms that are negative. In that case, we don't recommend a change. That's quite a high burden that we need to make sure we were satisfied because the worst outcome there is for somebody to change insurance companies to ensure that now they have a cancer exclusion. And then they have cancer in three years, they would have been covered under the old policy new policies left behind, right. So that's a big thing for us, we look at that doing no harm.

A lot of our advice as well, there's no there's tangible and intangible benefits. So the tangible ones are easy move from ABC super to x, y, zed super safe 1% in fees of three grand a year, over 10 years, you'll have an extra $45,000 in your account with compounding. Easy, tangible solution, that's a no brainer, let's get you into the new fund. an intangible one's a bit different, though. So an intangible one as it sounds is things that you can't really put your finger on. So these are things we're talking about like peace of mind, confidence, certainty, direction, clarity. And a good example of this is the mathematical solution. Let's say you've saved $50,000, and it's sitting in the offset account, and you're saving yourself about six and a half percent in interest tax rate. You're in your 40s the arithmetic would suggest that you could possibly be much better if you move that $50,000 into a high growth share portfolio, leave it for 30 years, it'll grow at some exponential, right, and you'll be in a wonderful position. Mathematically, tangibly, that could be the best outcome. It's a bit speculative, because we're talking about future returns. But it might be the best outcome in tangible terms.

Intangible terms, you have $50,000 sitting against the mortgage that you desperately want to clear in the next 10 years, you have $50,000 It's available a drop of a hat $50,000 That won't fall in value. The mathematical tangible aspect of that suggests you go to shares, but realistically the best option for you in that case is to stay in the offset account. So it's an intangible benefit that we wouldn’t’ve done that we run projection. So a big part of what we do is we take out knowledge, forensic knowledge of your financial position, and we plug it into our system and then we run a projection out for the next 20 or 30 years. And we say with a fair degree of confidence that if you continue your current path and nothing changes, you will end up at this point, and it'll be higher than where you are now your wealth, your income, security.

Then we talk about how we can improve that because inherent in that you will have needs and wants and those needs and once we can quantify. So you will have $1 amount that you should be achieving by a certain age. Now if your trajectory will not get you there, then we talk about improvements. So this is where we're talking financial planning, the strategic picture, not the tactical side. We then gets a document that and we document that in a series of documents, the primary one to be concerned about is the statement of advice. There's a lot of discussion about these documents, because these are the core documents of financial advice. Anytime you are given personal financial advice, you need to receive a statement of advice. Traditionally, they've always been done in writing, sometimes that can be done via video now, kind of something we're looking at. Statement advice says, “Here's what you're looking to achieve, here's our understanding of where you are. Now, here's all you recommend. Here's the upside downside of that. And here are the costs.” Sounds simple because it is the document. The issue is that historically, that document which really could be done in eight to 10 pages has been blown out to 100 120 pages, because legal departments get involved, and they want to minimize risk, basically. So what that meant is that it's taken is really important document that people should be able to read, you know, the regulator says that it should be clear, concise, and usable. And it's become this unwieldy thing. And we're, we've tread that line between legality and legibility, and we are coming back, it's a big focus for us in our practice to make sure that the documents you're getting from us are legible legality, don't do dodgy stuff, I think is a good excuse.

So we're playing around with how to present that often, I will record a video kind of like this walking through the document in a PDF form and send that to you. And then you can review it in your own time, then we meet up and we go through actually implementing it.

Which is Step five, implementing the advice is as it sounds, getting it done, prepping all the paperwork, signing off, lodging it, sitting on hold with the superfans, and Centrelink and everybody else apparently, in Australia now for longer than should be to get something done. So my team pushed that through. Most advisors will have people help them with delegating that responsibility to an extent. So there'll be a lot of signatures required a lot of authentication, we run a lot of security protocols around that, because it's important stuff. And then the confirmation goes out. At the conclusion of that, the process is finished. So then we move into our track or review progress process. Traditionally, these have been called reviews. It's really about checking in to see how you're progressing to that goal we were talking about. So your needs are being taken care of your wants? Are you any closer to achieving them? Have any speed bumps or roadblocks come up that you've had to navigate around? How are you tracking, because that progression through your financial life, if you're trying to improve your financial life and build a better one, it is like climbing a slippery slope, things happen, things change, things are kind of undermining you as well. So every year we check in with people and make sure they're climbing that slogan in a productive way.

So it's a six step process. Now before you go into that process, and before you start speaking with an advisor, the big question I'm curious about is why are you seeing a financial planner? Now, are you saying, you know, financial planner for a purely technical question, the insurance review? What should I do with my super? How do I save more money? Or are you looking for a bigger strategic picture? How do I feel like we're doing the right thing, but I'm not sure how do I know if my lives on track? Let's face it, you know, each generation has a different financial journey, they're going to be walking with different obstacles. So it's hard to gauge people's progress by the generation that went before or the one that's coming after. So we do a lot of that kind of work. It might be an event in life that's triggered that so you've inherited some money, and you want to know what to do with it. Either way, the process is the same. It just requires different focus and different attention in different areas.

And all of it is geared towards this journey that we've touched on. So we start by getting an idea of your needs, and everybody will have financial commitments they need to meet each week, each month, each quarter each year. Primary ones tend to be mortgage repayments, school fees, utility bills, grocery bills, caring for infants and parents, contributions to daycare, things like that. Getting a clearer picture of that that's kind of the first level of your financial life. Beyond that, we start talking about once. And I've distinguished in this diagram between wants and aspirations. Once are things like, I would like to buy a new car in three years. I would like to have half a million dollars and super. I would like to buy a better house. I'd like to buy our forever house in the next couple of years. These are once I want to be able to work in a better job or I want to be able to reduce my hours.

This is the second tier of your financial life because this helps us determine really what are the things we should be prioritizing. Because the offset example before on the share portfolio example, there are cases where the share portfolio will be better for people, depending on what they're looking to achieve. We then hit the speed bumps and roadblocks and like I've said already, these can be very different things. But what we need to do is prepare you so that you can absorb the predictable ones or avoid them. And the unpredictable ones don't knock you off the high wire. So there's a navigation aspect here.

And we, we spent a bit of time trying to identify these because the predictable ones we want to try to avoid, then we can start talking about aspirations. And these are much bigger things. These are bigger ideals and values. These are, I want to be financially independent, as soon as possible. I want my kids to have a better life than I had. I want my kids to be able to, you know, be well educated and safe. And we want to retire early so that we can do all of these things. It's a really big part of financial advice. These are long term things, very few aspirations are achieved within two to three years, there's only a 10-year project. So these are the lights on the Hill that will orient your decision making into the future. So as you as we get older, you have to make mutually exclusive decisions with money. You choose route a or choose route B, the aspirations will help make that choice easier.

And by having a really solid foundation of aspirations that are built in based on values and wants and needs. It makes it a lot easier to avoid the Joneses, you know, trying to keep up with them, you can run your own race that way. Because what this process leads to ultimately is your best financial life, your best financial life will be different to the person next to you, to your family, to your neighbors. It's building your best financial life. And all of that is based on knowing what all of these categories are to give yourself the best chance of building that.

So that's the financial planning process in a very rapid nutshell. It is very similar in all cases. So we follow a very similar process, a very similar map when we're helping people just to make sure that we don't miss anything, and that we're giving ourselves and then the best opportunity to get the most value out of the process.

But in doing that, I unashamedly work on what I call personal advice, which is where we get to the point that advice is not equal. There are different types of advice out there. Now for the purposes of this discussion, I am ignoring the advice you get online, you know, via social media influences, influences or whatever they call them. Ignore the guy down the pub or the taxi driver, or the person you bumped into on the bus that has an idea around how money should work. That's not advice. That's opinion, sometimes from money.

 Advice is a very different thing. Advice is a statement or declaration or implication that's designed or stated to influence your decision. In Australia, financial advice is based around the idea of financial products. Now, financial products are things like Superannuation funds. So Australian super, is a super fund. And within that there's different types of accounts, those different types of accounts or financial products. Your bank has financial products, they've got transaction accounts, savings accounts, things like that. Interestingly, I don't think debt is kind of a product in Australia for some strange reason, or it is and it's kind of carved out in a weird way. But investment accounts, insurance policies, these are all financial products. And in Australia, financial advice only exists legally when it is about a product. So if that advice is to try and remember the wording now around disposing of keeping retaining or purchasing a new financial product, then it is considered to be financial advice. And it triggers the requirement to provide a statement of advice. So we're getting into the legalities here. But within that infrastructure, there are three tiers of advice. The first one is factual information. It's not really advice, but we put it in here because it does come up a lot in the financial world. And this is where it is a declaration of something that is objectively true. It does not really exist in relation to your circumstances. It is just objectively true. So the Superannuation Guarantee rate in 2023-2024 is 11%. That is an objective fact we can't change that. That is just how it is. ABC supers’ administration fee is 1.25% a year. Again, that doesn't affect anything. That's just a fact that can be found in their website, on their website and in their PDS.

PDS was a Product Disclosure Statement. There was a lot of this factual information because it is needed for you to make a reasonable person such as yourself to make an assessment on whether or not they should buy this product themselves. So this insurance policy will cover you for x y z. This bank account pays this rate of interest. So these are all facts. So that's good information we need to help make a decision. In most cases, it's not an issue.

We then start drifting into an area that that's advice adjacent, like it is called advice, general advice or statements that don't consider your objective situation or needs. So, you know, it is information or advice that's given to you it's given to me is given to every Tom, Dick, and Harry the calls. Because it's around can or could advice, by which I mean, we're talking about things that you could do, the person you're speaking to, or the people that are providing the advice and not saying whether or not you should do it. They're just saying, Yeah, you could, you know, you could contribute up to $27,500 a year as concessional contributions. You can do that, however, what's not included in that and what makes that general advice is they're not saying, based on your level of contributions this year, you have X $1,000 left in your cap, therefore, you can contribute up to Y $1,000 into super. That's personal advice. This is general advice, saying, Yeah, you can do that. You could pay for your life and TPD insurances and your Superannuation, you could pay for your AIA life and TPD insurance using your post plus Superannuation. You can do that, when we're not talking about whether or not you should, because should become a discussion around pros and cons, tradeoffs, downsides and upsides. So general advice is really prominent.

So anytime you hop onto a superfund website, and if you do that, often, the disclaimer the header of this presentation, at the most presentations, it's saying that is general advice. And the distinction is we are not considering your objective situation or needs in preparing this information or providing any documentation. So all of our blogs on the website and the videos, I don't know you so I can't really consider your circumstances in preparing that intro. It's not so much in this one. In the future ones we're going to get really detailed around products and strategies. But in those ones, there are some people for whom some of those strategies are a terrible idea. So one might be a contribution strategy. So the common strategy where older Australians have what's called a taxable component in their super fund, which upon death, if that money goes to non-tax dependents, they will pay what's called a death benefits tax, but dependents do not the deceased.

So a common strategy then is to pull a chunk of money out of that Superfund and pop it back in and you wash off some of that taxable component. Therefore, reducing the tax payable to adult children normally works really well, we can make the numbers stack up really well. But it may be a terrible idea for some people. So some people may not have a taxable component in their super fund for their kids, maybe 12 and 11. There's no benefits in that case of them doing it. They may not have kids, they may not want the money to pass on. It's general advice is one size fits all personalized advice is tailored. That's the big distinction here and I think it is important to flag this the reason I'm sort of spending so long on this.

General advice is what a lot of people see as financial advice out there. Now they call their super fund, and they talk about the investments in there. They move it around, it's general advice. It has its place, but it's not, in my opinion, the core of advice.

The core advice for me is personal advice. This is what I provide. This is what most financial advisors every financial planner will give personal advice is that should category of advice, “you should contribute an extra 750 per month to your supers concessional contributions, Mr. Client, because I have looked at your circumstances, and I've worked out that you can afford it, I've worked out that will help your Superannuation achieve your goal in retirement. And I've worked out that your super fund is an appropriate option for your investment. It's a much bigger picture. And it's very tailored to this individual Mr. Client.” Now, there may be people that are on this webinar where 750 A month is the exact amount to put into super. But I would wager that's not the case. So this is this is very personalized advice. It's very tailored. And in those statements of advice that we were talking about.

When we write ours, you have to use a template. You've got to have some stuff in there that's boilerplate, but the bulk of it has been tailored to the client's personal circumstances. So we have people that, you know, “Mr. Client, Mrs. Client, you have wildly different risk tolerances. However, after discussing your goals of retiring and 57, paying off all your debt by 50, your issues around Mrs. Clients health situation, you know, you have three kids, but one of them has special needs or has high needs. Based on all that, here's what we recommend you do”. Now that person or that couple probably won't see the same value from calling ABC super and moving their money around. So it's just a very different kettle of fish. Another example is Yeah, you should move your super to ABC super to reduce your admin fee. As always more detailed, it's always got more ways to do it. And this is advice that does very much consider your objectives, personal situation and needs. And this is designed to help you improve your situation, it's to help give you the greatest odds of kept building your best financial life, by your neighbors, by your brothers, yours. So it's very distinct.

Now one of the reasons I'm sort of driving this home, obviously, it is important to know and pretty consumers of advice out there, you should know the differences. But it's also very different in terms of delivery and cost.

So I'm moving a window around. I’m not sure if you see this obvious shifting that this slide is familiar, these are the six steps of the financial planning process. This is very much around personal advice, journey. It's very good to know you. It's very individual, it's very bespoke and tailored. It's very high service, high touch. That is the personal financial advice process. This is a general advice process. So you'll see that everything left of the line where they get to know you and they get to know your circumstances does not happen, which is completely fair, general advice does not consider your personal circumstances. So why would they bother investigating it. And also, there is a cost to collecting all of that information. So that's also a general advice has its place in the market for generic standard stuff. So steps four and five are basically it, they'll give you the information and the advice that they determine if that's what you're looking for. And then they'll process that and follow it through to completion. So it's a very, very different experience. It's, it's the difference between seeing a GP and watching a guy on YouTube. It's probably a bit blunt and might be a bit much. So that's the general advice process. So that's what we're looking at when we talk about the difference there.

There's also a difference in terms of the kind of the speed, the cost and the value of it. So factual information. It's only real value as a reference point. There's no context there. There's no contextual consideration of your circumstances. So as a reference, only PDS, you're making your own decision, you've got your record there. It shouldn't cost anything. I've said zero to low, really just to avoid the exceptions. The speed of its immediate, really, it's a Google search away. It's the information sent directly to you. And it's primarily provided through the internet and product providers. It's not really something that you get in the mail. It shouldn’t be anything you're getting emailed. Unless you're getting scammed or spammed. That's a very distinct element. general advice is different in general advice is provided by the product providers normally.

So you call Australian super, and you talk to them about your super fund, they're probably going to give you general advice. You know, based on your risk tolerance, you should have a different investment account based on your insurance position, you should have more or less insurance. very general, very generic. Very limited. So that insurance example I'm just thinking about that's personal last. The speed. This is also pretty quick, you know, you're calling them, you'll normally get a document emailed out to you, or read out to you over the phone within minutes. And the cost is normally zero to low that they absorb a lot of that costs in their administration fee. So when you're calling them that's what you're getting.

To my mind, it is primarily a reference discussion. You know. Here's the information I need to make my own decision. Basically, there is some you know, that decision value is there. But very much it's very limited to just strictly that decision. So it's a show of any broader context. And this is probably where a bit of my discomfort with general advice comes in because we can look at somebody's Superannuation in isolation. So I was talking to somebody earlier today. Their mother-in-law is looking to retire early. She wants to retire at about 62 or 63. Go part time and then retire and be fully finished by 67. Cool Superannuation fund would say “Yep, great change the investment mix and look at something like a retirement pension, which is beyond the scope of what we're talking about. But that's the solution. Here's the dollar amount payable to you; here's how it's going to project out.” So in isolation, they've answered some of your questions, they've given a general class, for the questions that we were talking about was, what does that mean for the age pension? Once you hit 67? Is that assessed? How's that assessed? How's it structured? What does it mean if she passes away early? What is the taxation position? Should she spend the next few years putting more money into super? She has an investment property over here. She wants to sell that at some stage, if you sell it now, should you sell it later.

There are all ancillary points that sit outside that channel of what she was talking about. And in reality, answering that channel thankfully won't damage her situation. But there is a risk here that focusing on a limited aspect and ignoring the broader context can limit things. And, you know, the world of financial advice or finances probably has something like 16 to 20 different spokes around the wheel. If we're only answering one or two of those spokes, we don't know what the flow on effect might be. You know, we've seen this example. So many examples of super funds saying yeah, “no, definitely roll your x y z super into our account, you'll be better off it's cheaper. client does that client has lost $500,000 of life insurance.” Client dies two years later. That's a disastrous outcome.

So I'm really dumping on general advice it has its place but from my world, we look at personal advice, which is, frankly, at slower, you know that that six step process we were talking about before, that could take three months, you know, the cost is medium to high, you know, we have fees that we charge for the work that we do, and that is linked pretty directly to how long it takes. So if you look back to this, all of this work over here, steps 1-2-3, that could be 15 to 25 hours’ worth of work for my team and I add even a modest hourly rate, that's going to add up to a cost that general advice doesn't have. All of this takes time as well, and expertise. So there is a cost involved in personal advice. But again, it's like seeing a non-bog billing GP compared to watching a guy on YouTube. With knee surgery, it's not quite the metaphor stops there. But I think the value is really for some, I think the world of advice as it is now that cookie cutter approach isn't the norm. It's deeply personalized, deeply valuable, and helps you feel confident, or people feel confident about the path that they're on towards their best financial future. So it's an incredibly valuable, but discretionary service. So that's, that's the breakdown there. So that'll be in the slides there. And I think we've come to the end.

I hope this has been helpful. We've covered a bit of ground there, we've talked a fair bit about how financial advice works, and we've kind of dived into the weeds a little bit. You know, this is stuff that I don't think most people really are aware of when they go to engage a financial planner. Like I've said previously, the people that we see kind of tend to have a very discreet requirement. Review My insurances. What should I do with the money in the offset account? I've got a raise, what should I do with it. And that tactical stuff we can help with every day of the week. It's almost mechanical. But this strategic overlay is really where financial advice works. So it's really where knowing how the process flows and how it plays out. It's been really useful. So I hope that has been of some value. We will wrap it up there. Like I said, this will be available on the website, and we will be chopping it up for sort of marketing stuff. And it'll be on the YouTube channel as well. So if you have any questions, feel free to reach out and I will see you at our next presentation.