DISCLOSURE STATEMENT

Working with Echelon Advisers

Licensing Information and Contact Details

Echelon Advisers Limited (FSP100904), trading as Echelon Advisers, is a Financial Advice Provider, which holds a transitional license by the Financial Markets Authority to provide financial advice.

Phone number: 09-281 2604 or 09-281 2624 Email address: admin@echelonadvisers.co.nz Physical Address: 28 Bath Street, Parnell, Auckland 1052 Postal Address: PO Box 793, Shortland Street, Auckland 1140

About Us

Echelon provides a financial advice service covering everything from basic financial management and insurances to investment portfolio construction.

As the publics knowledge of financial matters increases there is a growing expectation that people should have a base foundation of financial literacy. In truth the subject matter is so large that knowing ‘what you should’ is often unrealistic in the face of other modern pressures.

The concept of having a Financial Planner is therefore a relatively new one; the idea being, to have someone relieve you of having to know everything yourself. As an advisory firm, our aim is to help you set your financial affairs in order, so you can get on with the rest of your life.

A large part of how we can help revolves around the software we use, and the financial modelling we do. Using your information to develop, not just an understanding of your finances, but a picture of how your choices and options might play out over the course of your lifetime.

We have a far more fluid approach than many large firms or institutions who tend to ‘qualify’ you first and engage you determined primarily by the level of income you can deliver to them or other advisers who struggle to help if there is no ‘product’ involved.

We are happy to spend some time with you knowing that invariably a client engagement will find its own level. We always invite people to use us as a resource and have found that doing the right thing comes back to us in one way or another.

Our Services and Scope of Advice

There are a number of ways we can help. While the list below is included to provide some markers for areas of expertise, it is helpful to understand that where we tend to help people most is by providing clarity and certainty.

Key areas of expertise are:

  • Financial modelling and sensitivity analysis.
  • Personal insurance planning and implementation.
  • Investment, retirement planning, asset accumulation and capital preservation.

However, our discussions may also include:

  • Financial Management (debt management, cashflows, income and bank accounts).
  • Guidance on property portfolios (note that this is limited to analysis and advice in a wider context and we do not help you find, buy, sell or otherwise transact).
  • Estate and asset planning.
  • Business insurance planning and succession.

We only provide financial advice about products from the following companies:

  • For personal insurances, we work with: AIA, AMP, Asteron, Cigna, Fidelity, PartnersLife
  • For medical insurances, we work with: Accuro, AIA, nib, PartnersLife, Southern Cross
  • For investment products, we work with: Craigs Investment Partners, NZ Funds, One Answer, Select Wealth
  • For KiwiSaver products, we work with: Booster, Craigs Investment Partners, Generate

We Work Through the Six Step Financial Advice Process

  1. Establish the Client Relationship
    We will agree on the scope of service and discuss what will be included in any advice.
  2. Gather Data
    Using the Planolitix Financial Diagnostic tool, we will gather the necessary information about your situation, needs and goals.
  3. Analyse & Evaluating Financial Status
    We develop strategies to meet your needs and objectives.
  4. Developing and Presenting Financial Plan Recommendations
    We will provide a Statement of Advice, outlining our recommended strategy and how it works to achieve your goals.
  5. Implementation
    Make an application to the recommended provider and ensure the best outcomes for you.
  6. Monitor & Review
  • We encourage periodic reviews of your situation to ensure our advice remains current, and this contact may come in the form of an email, letter or phone call.
  • Investments have a baseline of 6-monthly reporting, but communications with clients tend to find their own level depending on the level of contact preferred.
  • We also provide claims services.

Duties Information

Echelon Advisers, and anyone who gives financial advice on our behalf, have duties under the Financial Markets Conduct Act 2013 relating to the way that we give advice.

We are required to:

  • Give priority to your interests by taking all reasonable steps to make sure our advice isn’t materially influenced by our own interests
  • Exercise care, diligence, and skill in providing you with advice.
  • Meet standards of competence, knowledge and skill set by the Code of Professional Conduct for Financial Advice Services (these are designed to make sure that we have the expertise needed to provide you with advice).
  • Meet standards of ethical behaviour, conduct and client care set by the Code of Professional Conduct for Financial Advice Services (these are designed to make sure we treat you as we should, and give you suitable advice).
  • Meet the requirements as listed in the Privacy Act 2020.

This is only a summary of the duties that we have. More information is available by contacting us, or by visiting the Financial Markets Authority website at https://www.fma.govt.nz.

Engaging with Us

Because we have a broad range of areas where we can help, it is necessary to determine which area we are providing advice in, or whether we are being fully engaged across all areas. This is not fixed as a specific engagement as it can always be widened (for example, going from an ‘insurance only’ mandate to including retirement savings or investment).

An engagement will usually occur at the end of a meeting or discussion, once we have determined what steps should logically follow, and you have authorised us to conduct analysis, write advice, or otherwise take action in some way.

Depending on the nature and complexity of our initial discussion we may, or may not charge for a Discovery Meeting. Once we have been engaged by you, it is important to understand that we may charge you depending on the work we have been engaged to do.

Either way, you will be fully informed of any charges before taking further steps, and should never be surprised by an invoice.

Doing your Part

Every time we give you advice we will likely ask a range of questions about your situation. It is therefore important to help us develop the right thinking and let us know if you have strong views about anything in particular. Our advice is based on this information so it is essential that it is correct and complete. If you think our advice seems wrong for any reason you should let us know as soon as possible so that we may make any necessary adjustments.

It is important to understand that our advice will always be based on a historical picture of your situation. If anything material changes in your world our advice to you might change and to best help you, we would want to know about it.

We are most effective when we can communicate with you. Please inform us of any changes to your contact details such as when you move house, change jobs or adopt new email addresses or mobile numbers.

Please know that we cannot be held accountable for information not received or incorrect information that may otherwise affect our advice or services provided to you.

Fees and Expenses

An initial Discovery Meeting (up to 90 minutes) is charged at $500 plus gst. However, this fee may be waived if there is a definite intention to proceed with insurance or investment product/s.

Fees can broadly be split into two areas:

  • Fees for analysis, including any written advice and guidance (this includes insurance advice).
  • Ongoing fees for monitoring of investment funds under management.

In relation to commissions:

  • We normally receive initial and ongoing commission for any insurance business we place on your behalf.
  • No commissions are accepted for investments and where we cannot refuse them, they are rebated back to the client.
  • It is also our practice to refuse any ‘introductory commissions’ for referring clients to other third parties such as Solicitors, Accountants, or Property Specialists – if we refer you to someone then it is because we think they can help and not because we want to get paid.

For Insurance

The required research, analysis and time involved in preparing insurance advice is significant. If you engage us to provide an Insurance Planning Service and if you do not proceed in any way, then we will charge a fee starting at $500 plus gst but rising where additional time and complexity is a factor.

If you proceed with the advice and we get paid a commission by an insurer, then we do not charge a fee.

Upon the establishment of an insurance policy, the insurer will pay an initial commission. Once the policy has been in force for longer than 12 months, then ‘ongoing’ commission is paid, which is why a planning fee and a service fee are not required for insurance advice.

All commission structures for Echelon are disclosed in the advisers initial disclosure document, and once specifics of the advice are known are disclosed again.

This will outline the amount or rate of any remuneration (to the extent practicable), who it is received from and where necessary detail how any conflict of interest is managed.

It is worth noting that insurers pay initial commissions based on the expectation that a customer relationship that will last longer than two years. Where a policy is cancelled before the end of two years, the insurer will claw back a percentage of this initial commission. Depending on circumstances, we reserve the right to charge reasonable fees to re-coup costs for work completed over the engagement to that point.

For Investment

Written advice for investments or retirement planning typically starts at $1,000 plus gst and includes any implementation. Where any work becomes more involved than reasonably expected, Echelon reserves the right to re-negotiate a further fee.

Comprehensive Financial Plans go beyond the scope of investment and retirement planning, and can include analysis and commentary on financial management, estate planning and host of other pertinent subject matter. These start at $2,000 plus gst.

It is important to note that we do not charge fees to make investments. Other advisers may charge as much as 3% of your funds to be invested (eg: $3,000 per $100,000) and we do not do this. While it is a commonly accepted practice, we do not believe it to be a fair one. This means we have to charge properly for written advice, but given the work involved we feel this is reasonable.

Ongoing fees are charged on a Funds Under Management (FUM) basis. They can differ depending on the type of investment there is a sliding scale for the volume of funds, but typically will be no more than 0.95% inclusive of gst for a smaller engagement, falling to 0.65% for larger sums under advice. Ongoing fees are charged on a monthly pro-rata basis and subtracted from funds, unless arranged otherwise.

Hourly Rate Consultancy

Where we do not have an ongoing engagement, we can still provide transactional services.

For unstructured advice or appointments with an adviser, an hourly rate of $400 plus GST applies. Where this requires a meeting outside of business hours or out of office, an additional fee of $150 may apply. We may also charge fees to cover any implementation or administration resource.

Where a transactional service is provided, we will usually agree to a cost for service beforehand, although this may rise where time and complexity becomes a factor.

Other Interests and Relationships

We can use what providers we wish to on the basis of seems best for a client. This typically means that while we can use a range of providers, we tend to favour a small group and most clients will be advised accordingly. It is important to know we are not ‘locked in’ to any commercial relationships or contractual arrangements that present any particular conflicts of interest to consumers generally which would be reasonably likely to materially influence the financial adviser service.

We do not have a trust account, do not handle client funds and due to the nature of the investment providers we use, cannot personally access client monies for any reason.

All funds are payable to the service provider directly. We do not accept hard monies of any kind to make an investment or pay an insurance policy.

Conflicts of Interest and Incentives

Echelon Advisers receives commissions from the providers on whose products we give financial advice (the insurers, investment, and KiwiSaver providers). If you decide to take out personal, or medical, insurance the provider will pay a commission to Echelon Advisers. For investments, the adviser fees are based on the funds under management. KiwiSaver providers tend to have an initial transfer commission, and further adviser fees are based on funds under management.

From time to time, product providers may pay for lunch, or give token gifts around Christmas.

To ensure that our financial advisers prioritise the client’s interests above their own, we follow an advice process that ensures our recommendations are made on the basis of the client’s goals and circumstances. All our financial advisers undergo annual training about how to manage conflicts of interest. We maintain registers of conflicts of interests, and the gifts and incentives we receive. We also perform an annual review of our compliance programme.

Termination of Engagement

You may terminate our engagement in writing at any time.

We may also stop working for you if:

  • We have a conflict of interest.
  • Our fees are not paid.
  • There is other good reason for us not to complete your instructions.

If either of us terminates the engagement, these terms will survive the termination and you must pay us for all work we have done and expenses we have incurred to the date of termination.

Termination will also occur if:

  • You withdraw all funds under management and/or cancel all insurance policies.
  • The principal transaction that formed the basis of our engagement is completed.

Complaints Handling and Dispute Resolution

If you are not satisfied with our financial advice service you can make a complaint by emailing admin@echelonadvisers.co.nz or by calling: 09-281 2604.
You can also write to us at: PO Box 793, Shortland Street, Auckland 1140.

When we receive a complaint, we will consider it following our internal complaints process:

  • We will consider your complaint and let you know how we intend to resolve it. We may need to contact you to get further information about your complaint.
  • We aim to resolve complaints within 10 working days of receiving them. If we can’t, we will contact you within that time to let you know we need more time to consider your complaint.

We will contact you by phone or email to let you know whether we can resolve your complaint and how we propose to do so. If we can’t resolve your complaint, or you aren’t satisfied with the way we propose to do so, you can contact IFSO (Insurance and Financial Services Ombudsmen).

IFSO provides a free, independent dispute resolution service that may help investigate or resolve your complaint, if we haven’t been able to resolve your complaint to your satisfaction.

You can contact IFSO by emailing info@ifso.nz, or by calling: 0800 888 202.
You can also write to them at: PO Box 10-845, Wellington 6143.

Variations

We may at any time vary these terms and this will apply at the date of publication. An updated document can be requested, but will not be automatically delivered to you.