Why You Need a Financial Adviser

Why do you need a Financial Adviser?

Have you heard of anyone wanting to build a home without a properly drawn out plan by an architect? So, why would you leave your future financial health and wealth to chance? To achieve any desired outcome, it needs to be properly planned. In this case, the help of a financial adviser can be critical.

Building and managing an investment portfolio is a lifetime pursuit. Once you have made the decision to be an empowered investor, the journey begins with a well laid out plan with the help of a qualified financial adviser.

To appreciate and understand a good financial plan, be aware that there are two phases in building an investment portfolio; the Accumulation Phase and the Wealth Management Phase. Over the phases, a qualified and competent financial adviser can help fast track your results, improve your understanding of the complex world of investment, economics and tax and help you safely employ the strategies and techniques that will give you the edge to succeed and build the portfolio you need to live the life you desire.

The Accumulation Phase

For all investors who don’t start with an inheritance (and most people who achieve great wealth don’t) this is where they begin. Building a portfolio starts with saving money to make your first investment. After your first investment, you continue to save and reinvest that over the whole accumulation phase. There are several important aspects to this phase.

Continual Saving

Without savings you can not make your first investment. Save a certain percentage of your income and learn to live off the rest. That will teach you to live within your means and you’ll surprise yourself at how resourceful you’ll become in finding savings in all areas of your life, like in your shopping, your tax bill or your lifestyle. That percentage of your income saved needs to be continually added on to your investments to make it grow.

Your financial adviser can help you set up a savings plan for the short, medium and long term according to your circumstances. He/she will help you identify tax savings, cost savings and put in place a budget that will allow you to improve your savings capacity.


The financial adviser’s job is then to help you continually reinvest all the income from your investments back into your portfolio. All the income that is accumulated from rental income, dividends or interest should then be used to fund either the purchase of additional shares or fund the deposit of additional real estate or reduce your portfolio debt.

A review of your portfolio should be done regularly to maximise investment opportunities. Your adviser can help you identify the most optimum use of your returns to help generate further returns or reduce your debt as quickly as possible.

Tax Effectiveness

Constant review and adjustments to your portfolio is essential to ensure that it is achieving its most tax effectiveness. It is important that your affairs are consistently monitored and reviewed so that they remain relevant to your portfolios progress, your lifestyle, changes in legislation, taxation and the economic environment.

The world of finance, investment and taxation is complex and ever changing. With the right advice you can achieve your retirement aspirations sooner. Do it alone and you may be faced with an unexpected or unintended investment arrangement that could be very costly to rectify.

The Power of Leverage

Where possible and appropriate, you should consider the prudent use of leverage. That is… using other people’s money (borrowings) to increase your investment returns. Leverage offers you the ability to earn returns, not just on your own money, but also on other people’s money. It allows you to increase your return on your capital above the level that could be possible if you just invested using just that capital.

But you should be aware, borrowing money adds additional risks. Your financial adviser, with the assistance of a qualified mortgage broker, can work with you to show you the best way to structure your arrangements, protect your capital and use leverage safely.

The Magic of Compounding

The longer your portfolio builds, the greater the compound growth. That is why it is important to start now and remained disciplined in your approach. According to a recent article by Motley Fool, if you had invested $10,000 in the Australian share market 30 years ago, and reinvested your dividends, it would now be worth over $300,000 today without a signal additional cent of your own money being added? Doing some quick calculations, if you had of increased your return by just 3% each year, by picking better companies to invest in and avoiding the losers, that same $10,000 would be worth in excess of $660,000 today.

Giving it time and striving for small incremental improvements in your returns can have a massive impact on your final nest egg. Your financial adviser can help you efficiently use your capital in order to extract maximum returns.


It is always prudent to cover the downside risks whether they are life risks, financial risks, economic risks or business risks. You need to identify what risks you face, and monitor/manage those risks on an ongoing basis. Every good financial strategy should self-complete, even when unexpected events occur. Your financial adviser can devise strategies and identify insurance products that will appropriately lower your risks and ensure you achieve your goals and objectives, even if something unexpected occurs.

Continual Education

Education is a very important facet of wealth creation. You need to become the person who can generate the result. To be able to do that, you need to be well educated and informed.  You will find that this is the common thread with all successful investors. They are always learning so that they can be at the “top of their game”.

Throughout this process your financial adviser will introduce or advise you to implement certain strategies that you may not be familiar with. You should educate yourself and take it upon yourself to understand these strategies to ensure that you can benefit from these highly effective, yet, non-mainstream strategies. They may just give you the edge you require.

The Wealth Management Phase

When you get to this phase, your money is working for you and not you working for money. It is where you live the life of your dreams and you work because you want to and not because you have to.

What you have learned and achieved during the first phase, you can use to continually grow your portfolio and live from the passive income streams for the rest of your life. Then when you are not here, this portfolio can pass on to your family or charities that you are passionate about. Working with a financial adviser can be a very fruitful and highly rewarding experience. It can give you the confidence, tools and knowledge you need to succeed.

But it should not be seen as a substitute for the education, effort and discipline that is required of you.

With any financial adviser that you engage, the results will only be as good as the effort you put into the relationship and the discipline you employ in following the strategy. But get those aspects right and the enhancement of results and added peace of mind that comes with working with a trusted adviser can be invaluable.

We can’t overstate how important it is to plan for your financial health and what it can look like in the future. “Someone’s sitting in the shade today because someone planted a tree a long time ago.”- Warren Buffett. You don’t have to do it alone.

If you would like to know more about how you can better position yourself to maximise your wealth, contact United Global Capital today and speak with one of our financial strategists for a No Cost, No Obligation consultation on 03 8459 2121 or email [email protected] to learn how you can succeed.

 JOEL HEWISH B.Bus (Bank & Fin), GDipAppFin, GCertFinPlanManaging Director / Chief Financial Strategist – United Global CapitalAuthorised Representative No. 416387 The information contained in this report is General in nature and has been prepared without taking into account your objectives, financial situation and needs.

Recent stories

Understanding the Sharemarket: A Beginner’s Guide

Investing in the sharemarket can be a powerful way to grow your wealth over time. Whether you’re new to investing…

Read more

Franked Dividends vs Unfranked Dividends

When it comes to investing in the stock market, understanding the nuances of dividend payments is crucial. One of the…

Read more

UGC Monthly Market Update | May 2024

Join UGC’s Head of Research / Co-Portfolio Manager, Huw Davies, as he takes a deep dive into the latest financial…

Read more

If aged care advice is confusing – get advice

Many people think they can’t afford to get aged care advice, but the reality is you probably can’t afford not…

Read more

Mastering the Tax Game: Boost Your Wealth & Trim Your Tax

As the end of the financial year approaches, it’s the perfect time to refine your tax strategies and maximise your…

Read more