The costly mistake too many people make with financial advice

By guest contributor Bec Wilson

25 March 2025

Jenny and Geoff had done all the right things. They’d spent years saving, putting extra into super, and making smart financial choices. Now, with retirement on the horizon, they wanted to make sure they had a solid plan – so they decided to get professional advice. They booked an appointment with a financial adviser from an independent firm, hoping for a clear retirement strategy to guide their next steps*.

But instead of walking away with a clear strategy for managing their super and investment properties – or even a set of projections to help them plan their income in retirement – they were told the strategy they should follow was to move all their super into a ‘wrap’ account. It wasn’t something they had discussed in their first meeting. In fact, it wasn’t something they had been expecting at all.

Jenny admits that she and her partner may have been a little at fault. Maybe they didn’t ask the right questions. Maybe they should have been clearer about what they wanted. But here’s the thing – most people seeking financial advice don’t know the right questions to ask. That’s why they go to an adviser in the first place.

A good adviser (and there’s plenty of them out there) will guide the conversation, uncover what the client truly needs, and explain options clearly. They should ask about priorities and concerns, explore different strategies, and help people understand their choices – not just present a product-based solution.

To be fair, advisers work within a highly regulated system, and most genuinely want the best for their clients. But sometimes the structure of financial advice pushes clients toward investment products when they are really looking for strategy. When that happens, clients can walk away feeling lost instead of confident.

And they can end up making significant changes to the structure of their super that they don’t really understand, crystallise tax impacts in their fund, and can result in being costly to manage on an ongoing basis.

* Jenny and Geoff’s story is based on a true story but the names have been changed.

Finding the right kind of advice for you

Jenny and Geoff’s first email to me was emotional and their biggest frustration wasn’t just the product recommendation – it was that her bigger financial questions weren’t answered.

They had been hoping for advice on how different retirement scenarios might affect their finances, and what they could expect from their super over time. They wanted projections, structure, and confidence. But they walked away with more uncertainty than they started with. Did they really need a wrap? Jenny wasn’t even sure she wanted to go back and ask.

And it raises a warning sign for everyone of what you should be aware of and look for.

When it comes to financial advice, getting the right type for your needs can make all the difference. If you don’t know what you’re looking for, you could end up paying for advice that doesn’t actually suit your situation.

One of the biggest things people don’t realise is that comprehensive financial advice actually comes in two parts:

 ✔ Strategic advice
 ✔ Investment advice

Most financial advisers prefer to sell these services together – but you don’t have to buy both. If you’re already in a high-performing super fund, you might not need ongoing investment management at all. For many people approaching retirement, one-off strategic advice is enough to set a plan in place, navigate retirement with confidence, and make informed decisions about their super and income streams.

Understanding comprehensive advice: What you need to know

As I mentioned above there’s two different services most advisers can provide. And most (but not all) prefer to offer both to their clients.

Strategic advice is all about the big picture – building your retirement savings plan, structuring your income in retirement, and setting up a tax-efficient strategy. It often includes:

• Retirement savings and income planning
• Investment strategy (without ongoing management)
• Tax planning and asset structuring
• Long-term projections and cash flow modelling
• Estate planning guidance

Strategic advice often requires multiple meetings and can take an adviser and their team over 40 hours to develop. As a result, fees typically range between $3,500 and $10,000, depending on the complexity of your situation.

Investment advice involves the active management of your investments, including superannuation, shares, and managed funds. Advisers offering this service typically select and oversee your investments, recommend ongoing portfolio adjustments, and charge ongoing fees – usually ranging from 1.0% to 3.0%, depending on your investment choices. Most advisers providing ongoing investment management will also request that you move your investments onto their preferred wrap account or platform.

I’ll be blunt – some advisers won’t offer strategic advice unless you also sign up for ongoing investment management. But that’s not always necessary. If you’re in a super fund with solid long-term performance, you may only need a clear strategic plan and projections – not constant portfolio adjustments.

Before you engage an adviser, be clear on what you actually need. If your focus is on retirement planning and structuring your income, a one-off strategic advice session might be all you require – without the added cost of ongoing investment management.

Key questions to ask your adviser before making any decisions

Before committing to financial advice, make sure you’re asking the right questions. These will help you understand whether the advice you’re getting aligns with your needs and whether you’re being offered a service that genuinely adds value.

• Will you provide a full retirement strategy and projections, or just manage my investments?
  Understanding whether the advice includes long-term financial planning or just investment management can help you decide if it’s the right fit.
• Does your firm have a specific investment approach or a preferred product list?
  Some advisers recommend products from a limited range. Ask them to explain their approach so you can decide if it suits you.
  
• If I move to a wrap account, what happens to my current super fund?
  Find out if you’ll need to leave your existing super fund and how this could impact your fees, investment returns, and any attached insurance benefits.
  
• Can you show me different retirement scenarios?
  A good adviser should be able to model multiple options so you can make informed decisions about when and how to retire.
  
• Is this a one-time financial plan, or will I be paying ongoing advice fees?
  Clarifying whether you need ongoing advice or just a one-off strategy can help you manage costs and avoid unnecessary fees.
• Can you still help me with retirement planning if I keep my super where it is?
  Some advisers only work with clients who move investments onto their platform – ask this upfront so you know where you stand.
• What are all the fees involved, and how do they compare to my current setup?
  Request a direct comparison of costs so you can see if the advice you’re receiving will actually provide better value than your existing arrangements.

Asking these questions puts you in control – helping you ensure you get the right advice, for the right reasons, at the right price.

Stay tuned for my next article that will help you understand the three options most financial advisers present.

About Bec Wilson

Bec Wilson is one of Australia’s most respected authorities on midlife and modern retirement. She’s the bestselling author of How to Have an Epic Retirement, the #1 bestselling retirement book in 2023 and 2024, and the host of the Prime Time podcast. She runs Australia’s only 6-week retirement education program, and writes a weekly newsletter at epicretirement.net for more than 65,000 readers.

Visit Bec Wilson's website at epicretirement.com.au.