Finding the right financial adviser can be the difference between securing your financial future and making costly mistakes. In an age where unqualified operators can appear trustworthy online, it’s never been more important to know exactly what to look for—and what to avoid.
In this article, we explore how to identify a trusted financial adviser in Australia by uncovering 7 major red flags. If you’re thinking of engaging a financial adviser for the first time—or switching from a current one—this guide is essential reading.
Why It’s Critical to Work With a Licensed Financial Adviser
When you entrust someone with your financial future, you need to be confident that they are properly licensed and regulated. In Australia, financial advisers must be listed on the ASIC Financial Adviser Register and hold an Australian Financial Services Licence (AFSL) or be authorised by someone who does.
Working With a Licensed Adviser Ensures:
- Adherence to a fiduciary duty — putting your interests first
- Compliance with regulatory frameworks under ASIC
- Access to dispute resolution bodies like AFCA
- Legal protections and documented Statements of Advice (SoA)
Unlicensed advisers may offer services they are not legally permitted to provide, potentially leaving you without protection or recourse if things go wrong.
7 Red Flags to Avoid When Choosing a Financial Adviser
Spotting a dodgy financial adviser isn’t always easy. Here are seven key warning signs that the adviser you’re considering may not be acting in your best interest.
🚩 1. They’re Not Listed on the ASIC Financial Adviser Register
If a person claims to be a financial adviser, but you can’t find them on the ASIC Financial Adviser Register, this is an immediate red flag.
Why This Matters:
- All legitimate advisers must be registered
- The register shows qualifications, employment history, license details, and any bans or disqualifications
How to Check:
- Visit the ASIC Financial Adviser Register
- Search by their full name or business name
- Cross-check their AFSL number
👉 If they’re not on the register, walk away.
🚩 2. They Promise Guaranteed Returns or “Secret Strategies”
Any adviser who promises you guaranteed investment returns or claims to have exclusive, high-yield products should be approached with extreme caution.
Red Flags Include:
- “We’ve got a special opportunity others can’t access”
- “You’ll get at least 15% ROI guaranteed”
- “We’ve never had a client lose money”
Reality Check:
- Investment always carries risk
- ASIC regularly issues warnings about fake or misleading claims
- No legitimate adviser can predict or guarantee market performance
🚩 3. They Push Products Before Understanding Your Goals
A reputable adviser will begin by learning about your financial situation, goals, risk tolerance, and future plans before making recommendations.
Watch Out For:
- Immediate product pitches
- Lack of questions about your goals
- One-size-fits-all investment solutions
Why This Is a Problem:
- Advisers are required by law to provide personalised advice
- Product-first advisers may be working for commission, not your interests
🚩 4. They Avoid Talking About Fees or Fee Structure Is Vague
Transparency around fees is essential. A trustworthy financial adviser will clearly outline what you’ll pay and how they are compensated.
Red Flags:
- Refuses to disclose fees in writing
- Claims services are “free” (usually means commission-based)
- Complicated fee structures that are hard to understand
Types of Fee Structures:
- Flat fee: A fixed cost for service
- Percentage-based: Usually on assets under management
- Commission-based: Paid by product providers (risk of bias)
👉 If you’re unclear on what you’re paying or how they get paid—don’t proceed.
🚩 5. They Lack Third-Party Reviews or Testimonials
An absence of public reviews or testimonials may suggest a lack of experience—or worse, a history they’re trying to hide.
What to Look For:
- Independent platforms like Finistry that include verified client feedback
- Google reviews, LinkedIn endorsements, or industry memberships
Why Reviews Matter:
- They offer social proof and confidence from real people
- Help identify common issues or strengths in service
👉 A reputable adviser won’t be afraid of transparency.
🚩 6. They’re Not Willing to Put Advice in Writing
Legally, financial advisers must provide a Statement of Advice (SoA) before implementing recommendations. This document outlines your current financial situation, goals, and the specific advice given.
Red Flags:
- Adviser refuses to document advice
- Claims that paperwork is “not necessary” or “slows things down”
Why This Is a Problem:
- You need documented advice for clarity and protection
- Without it, there’s no paper trail if things go wrong
👉 No paperwork? No deal.
🚩 7. They Use Pressure Tactics or Create False Urgency
High-pressure sales tactics are a hallmark of untrustworthy operators. Ethical advisers give you time to consider your options.
Signs of Pressure Tactics:
- “This opportunity expires today”
- “You need to act now to lock it in”
- “Everyone else is doing it”
Why It’s Dangerous:
- Emotion-based decision-making can lead to regret
- You might commit to products that aren’t right for you
👉 Always sleep on a financial decision. A true professional will understand.
Bonus Tip: Questions to Ask Before Engaging a Financial Adviser
Here’s a quick checklist of questions you should ask in your first meeting:
- Are you listed on the ASIC Financial Adviser Register?
- What’s your licensing structure (AFSL or corporate authorised rep)?
- How are you paid? Are there any commissions involved?
- Can I see a sample Statement of Advice (SoA)?
- What are your qualifications and how long have you been advising?
- Are you independent or affiliated with product providers?
- Can you provide client references or testimonials?
How to Find a Reputable Financial Adviser in Australia
Finding a qualified adviser doesn’t have to be difficult. Use platforms like Finistry to:
- ✅ Search for financial advisers by location or specialty
- ✅ View verified credentials and licensing info
- ✅ Read client reviews and testimonials
- ✅ Compare professionals side-by-side
Why Finistry Is Your Trusted Source for Financial Advisers
Finistry is Australia’s independent financial services directory. Every adviser listed on Finistry:
- ✅ Has been verified with ASIC and holds the proper licenses
- ✅ Includes full ABN, AFSL, and service details
- ✅ Has access to verified client reviews
- ✅ Offers transparent, detailed profiles
No spam. No sales funnels. Just verified professionals available when you need them.
Conclusion: Trust Takes Time — Choose Your Financial Adviser Carefully
Engaging a financial adviser is one of the most important steps you can take toward financial security. But that decision must be grounded in trust, transparency, and verification.
Remember the 7 red flags:
- Not listed on ASIC’s register
- Promises of guaranteed returns
- Product pushing without understanding your goals
- Vague or undisclosed fees
- Lack of reviews
- No written advice
- High-pressure tactics
Use these warning signs to protect yourself and make confident, informed choices.
💼 Are You a Licensed Financial Adviser in Australia?
Join Finistry – Australia’s Independent Financial Services Directory
If you’re a certified, ethical financial adviser, Finistry helps you:
- ✅ Showcase your qualifications and areas of expertise
- ✅ Build trust with verified public reviews
- ✅ Get discovered by Australians actively seeking financial advice
- ✅ Stand out in a crowded online environment
👉 List your business now on Finistry – It’s free to get started.
Finistry: Your trusted source for finding and connecting with licensed finance professionals across Australia.
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