How to Choose a Financial Adviser for Your Inheritance in New Zealand
Inheritance often represents the first significant capital you've had to make decisions about independently. The weight of wanting to invest it well, to honour it properly, makes walking away from bad advice harder than it should be.
The standard guidance (check their credentials, compare fees, ask about experience) assumes you're shopping for a service the way you'd compare insurance quotes. But you're not. You're choosing someone to help you make decisions about money that matters.
The question isn't just whether they're qualified. It's whether their business model actually works for what you need, and whether they see you as competent.
Fee Structure Changes What Advice You'll Get
New Zealand has several adviser fee models. Each creates different incentives, and those incentives shape the advice you receive.
Assets Under Management (AUM), the most common model
AUM advisers charge a percentage of what you invest with them, typically 0.5% to 2% annually. On a $100,000 inheritance, that's $500 to $2,000 per year, every year.
The math: 1.5% AUM fees on $100,000 invested at 5% annual return over 20 years costs you approximately $62,000 in fees and lost compounding.
This works when you genuinely need ongoing portfolio management, regular reviews, and active involvement in your financial strategy. It doesn't work when you just need the structure set up properly and you're capable of maintaining it yourself.
The commission piece: Most AUM advisers don't just charge you directly. The fund manager also pays them a commission or trail fee. Check the disclosure documents under "scope of service" to see the full picture. Under the Code of Professional Conduct, advisers aren't meant to be incentivised by commission, but you can make your own judgement about whether that conflict matters to you.
Mixed model (fee-only that isn't, watch for this)
Many advisers advertise as "fee-only financial advice." They charge you a fee for the financial plan, anywhere from $600 to $10,000. Then they recommend investments on which they'll also receive AUM fees.
This is legal. It's disclosed. But it's not pure fee-only.
The conflict: If they only get ongoing income when you invest through their recommended platform or fund, that shapes which solutions appear in your plan. "Pay off mortgage" or "invest through low cost index funds directly" won't be recommended as often as options that generate AUM.
Ask explicitly: "After I pay for the plan, will you earn any ongoing fees from the investments you recommend?" If yes, it's mixed model.
Pure fee-only
Flat fee for advice, typically $2,000 to $5,000 for comprehensive financial planning. You pay once, get the strategy, implement it yourself or with their help, and that's it. No ongoing fees. No commissions. No AUM.
The adviser earns nothing from what you choose to do with the plan. This removes the incentive to recommend products or platforms that pay them.
This works when you're financially capable enough to implement and maintain the plan. It doesn't work if you need hand-holding or ongoing portfolio management.
Commission-based
Less common now for investment advice, more typical for insurance. The product provider pays the adviser when you purchase. No fee to you upfront.
This can work for straightforward decisions: you need life insurance, you want someone to explain options and handle paperwork. It doesn't work well for complex inheritance decisions where the best answer might be "do nothing yet" or "pay down debt first" (advice that doesn't generate commission).
What "Licensed FAP" Actually Means (And What It Doesn't)
Since 2020, all New Zealand financial advisers must be licensed as Financial Advice Providers (FAPs) under the Financial Markets Conduct Act. This means they've met minimum standards for competence, have a code of conduct, and must act in your interests.
What licensing guarantees: They're legally allowed to give advice, they have professional indemnity insurance, and there's a complaints process if things go wrong.
What it doesn't guarantee: That their advice model suits your situation, that they specialise in your scenario, or that you'll actually feel heard.
Checking FAP status is table stakes. You can verify any adviser on the Financial Service Providers Register at www.fsp-register.companiesoffice.govt.nz. If they're not listed, don't proceed.
The Gut Check (More Important Than Credentials)
Before you get to technical questions about fees and qualifications, pay attention to how the conversation feels.
Red flags:
If they lead with "here's my solution" and then ask a few questions to tailor it to your life, not the other way around. This means they have a product or approach they're trying to fit you into, not building strategy from your actual situation.
If they make you feel silly, incompetent, or position the relationship as them rescuing you from your own financial confusion. You're not confused. You're capable. You likely know more than you're giving yourself credit for. What you need is a framework to stress-test your thinking and allocate the money properly, not someone to teach you how investing works.
If you leave the conversation feeling like you don't understand your own finances. A good adviser makes complexity clearer, not more opaque.
Green flags:
They ask detailed questions about your situation before suggesting anything.
They explain their reasoning in plain language and check that it makes sense to you.
They acknowledge what you already know and build from there, rather than starting from scratch as though you know nothing.
You feel like a thinking partner in the room, not a client being managed.
Trust your gut. If something feels off, it probably is.
The Questions That Actually Matter
Once you've confirmed licensing and passed the gut check, these questions sort signal from noise:
"How do you get paid, and how much?"
This is the first question, not the last one. If they're uncomfortable answering clearly and with specific dollar amounts, that tells you something.
Push for specifics: "If I invest this $100,000 inheritance through you, what exactly will I pay in year one, year five, year ten?"
"After I pay for the financial plan, will you earn any ongoing fees from the investments you recommend?"
This surfaces the mixed model. If they charge you for the plan AND earn AUM on the investments they recommend, you need to know that upfront. It's not necessarily a dealbreaker, but it is a conflict worth understanding.
"Do you specialise in inheritances or lump sum investing?"
An adviser who primarily works with retirees drawing down portfolios gives different advice than one who works with people in accumulation phase. Neither is wrong, but one fits your situation better.
"What would you typically recommend for someone in my position?"
This surfaces their default approach before you've shared your full situation. You'll hear patterns. Do they immediately suggest KiwiSaver consolidation? Property? Managed funds? This tells you where their expertise genuinely sits.
"What happens if the best answer is to do nothing for six months?"
Good advisers sometimes recommend waiting. If you've just inherited money and you need time to process, rushing into investments isn't always wise. Advisers who only get paid when you invest can't afford to give that advice often. Pure fee-only advisers can.
When You Might Not Need an Adviser At All
If your inheritance is straightforward, you're already financially capable, your situation isn't complex, and you're comfortable with index investing, paying thousands for advice might not be the best use of capital.
The DIY path works when:
You understand asset allocation and can implement it through low cost index funds
You don't have complex tax situations, relationship property considerations, or business structures to navigate
You're willing to learn enough to maintain the strategy yourself
You have time and emotional bandwidth to research and implement
It doesn't work when:
The inheritance is large enough that the cost of a mistake outweighs the cost of advice
There are multiple considerations: your partner's financial position, business income, property decisions, existing debts
You want validation that your strategy is actually sound, not just functional
You value the mental load being taken off your plate
The Reality Most Advisers Miss
A lot of women who receive inheritances are financially competent. They understand investing. They've read the books, listened to the podcasts, done the research.
What they need isn't someone to teach them how index funds work. They need support to stress-test their thinking, a framework to allocate the money properly, and validation that their strategy is sound.
The adviser who assumes you know nothing will waste your time explaining basics. The adviser who recognises you're capable but need a thinking partner will add value.
This is why the gut check matters. If you leave a meeting feeling patronised or like you've been rescued from your own incompetence, find someone else.
When Pure Fee-Only Makes Sense vs. When It Doesn't
Pure fee-only works well when:
You have complex considerations (relationships, property, business income, existing investments)
You want strategy without ongoing percentage fees
You're capable of implementing once the plan is clear
You value paying once rather than annual AUM
AUM might work when:
You genuinely need ongoing portfolio management and regular contact
You're not confident implementing or maintaining on your own
You want someone actively managing your investments
You're comfortable with the ongoing cost in exchange for the service
Watch out for mixed model when:
They charge you for the plan AND earn AUM on recommended investments
You're being told it's "fee-only" but there are ongoing fees built into the fund structure
The disclosure is technically there but not clearly explained upfront
The wrong fit isn't about credentials. It's about incentives that don't match your situation.
What to Do Next
If you've inherited money and you're trying to work out whether you need an adviser, start here:
First, confirm your situation is complex enough to warrant paid advice. If your inheritance is straightforward, you're already investing through index funds, and your only decision is "add it to existing portfolio or pay off mortgage," you might not need comprehensive financial planning.
Second, decide what you're actually paying for. Do you need a one time strategy, or ongoing management? Most inheritance situations need the former. The latter is often sold when it's not necessary.
Third, get specific about fees before you commit. "Percentage based" sounds smaller than "$1,500 per year," but they're the same thing on $100,000 at 1.5%. Make them give you dollar amounts, not percentages.
If you're navigating an inheritance alongside relationship changes, property decisions, or career shifts, the right adviser gives you strategic clarity: how everything fits together, what happens if circumstances change, and validation that your plan is actually sound.
Choosing that person isn't about credentials alone. It's about whether their business model can give you advice that's genuinely in your interest, even when that advice is "wait" or "do less than you think."
Frequently Asked Questions
Do I need a financial adviser if I've inherited money in New Zealand?
Not always. If your situation is straightforward and you're financially capable, you can implement a strategy yourself. Advisers add value when your situation is complex or you want professional validation.
What's the difference between fee-only and commission-based financial advisers in NZ?
Pure fee-only charge a flat fee ($2,000 to $5,000) and earn nothing from your investments. Mixed model charge for the plan plus earn AUM fees on recommended investments. Commission-based earn money when you purchase products. Ask: "After I pay for the plan, will you earn ongoing fees from what you recommend?"
How much should I expect to pay a financial adviser for inheritance advice in New Zealand?
Pure fee-only: $2,000 to $5,000 flat fee. AUM: 0.5% to 2% annually ($500 to $2,000 per year on $100,000). Mixed model: $600 to $10,000 for plan, plus AUM fees on investments.
How do I check if a financial adviser is legitimate in New Zealand?
Check the Financial Service Providers Register at fsp-register.companiesoffice.govt.nz. All advisers must be licensed as FAPs. If they're not listed, they cannot legally provide financial advice.
Should I use a financial adviser who specialises in women or inheritance?
Specialisation matters more than gender. Look for advisers who regularly work with lump sum inheritances. Ask how many inheritance cases they've worked on in the past year.