Financial Advisor Malaysia – Definitive Guide 2023 / 2024

Who is a Financial Advisor Malaysia?

A Financial Advisor (FA) is a company approved by Bank Negara Malaysia under The Financial Services Act 2013 (FSA) and Islamic Financial Services Act 2013 (IFSA) to carry out financial advisory business.

FSA and IFSA regulate companies and individuals that provide advice on Insurance and Takaful products to consumers. The laws also provide Bank Negara Malaysia with the necessary regulatory and supervisory oversight powers to ensure business conduct and consumer protection compliance.

Who is a Financial Advisor Malaysia Representative?

A “Financial Advisor ’s Representative” (FAR) means an individual who is in the direct employment of, acting for or by arrangement with an approved FA, who performs for the FA any services relating to financial advisory business.

financial advisor malaysia
Work Scope Of A Financial Advisor Malaysia & Islamic Financial Advisor Malaysia

What Financial Advisor Malaysia Do?


Regardless of what scope of advisory that best fits your needs right now, the financial advisor advisory framework will be similar as outlined below:

Step 1: Identify your Priorities & Scope of Advice

Financial Advisor needs to speak to you to precisely pinpoint your pain point(s) & desired outcome(s) from the financial advisory you are seeking. This is the fact-finding stage where expectations are being set as financial advisor propose how he or she will conduct the advisory session(s) for you to address the matters you need to resolve.

Step 2: Gather Necessary Information from you

Depending on your scope of advice, this could be in the form of your current investment portfolio statements (investment advisory), details of your existing insurance policies (insurance restructuring advisory), income & spending and asset & liabilities (retirement road-mapping advisory) or tax filings & income statements (tax planning advisory for business owner).

Step 3: Audit & Analyze your Information

Financial advisor reviews the information provided, crunch the numbers and do a comprehensive ‘situational analysis’ to correlate the root cause of the issue(s) you are seeing & feeling. Financial advisor prepares recommendations by putting ourselves in your shoes.

Step 4: Recommend & Explain your Options

During the 1on1 advisory sessions, financial advisor explain his/her findings and go through with you the options you have to address the matters at hand. Financial advisor advises you on the pros & cons of each options, at the same time getting your feedback to fine tune the solution(s) that is in your best interest.

Step 5: Make & Implement the Best Decision

Financial advisor may carry out the recommendations or serve as your coach, coordinating the process with you and other professionals such as investment managers or accountants. Financial advisor may also handle the interaction with solution providers.
Certain scopes of advisory can be a dynamic on-going process that requires continuous monitoring. When needed, financial advisor reviews the actions implemented periodically, to take into account of changes in income, asset values, business or family circumstances.

What Financial Advisor Malaysia should I use?

If you want to minimize financial advice that comes with minimal or zero conflict of interest, look for the licensed financial advisor with CFP. Here is why (comparison table below)

CompareLicensed Financial AdvisorTied Financial
A Bachelor’s Degree, CFP certification (240hrs of lecture and 14hrs of exam) or RFP certification, 3 years minimum of relevant experience.SPM, CPE (2hrs exam), CEILI (2hrs exam), CUTE (2hrs exam)The Ivy league universities vs others
Financial planning & systematic process or holistic approach, i.e. optimizing your current & future resources to your financial goals. In-house research on funds selection, life insurance plan stars rating and financial life planning / cash flow modelling.Single need / piecemeal solution and pretty much product focused.Chief Accountant / CFO vs Accounts executive.
No. of
providers or
At least two providers in life insurance, unit trust and PRS. In addition provide service like financial plan and estate planning, i.e. will writing, trust, biz succession planning, etc.Cannot represent more than one supplier, and tied to its principal1-stop shop, e.g. Senheng Electric, senQ, Harvey Norman.
represented /
Client &
Client & Professional (i.e. FA) relationship. (Is required to purchase a Professional Indemnity insurance).Client & Supplier (i.e. Insurer / Unit Trust Management Company) relationship (note: Agent acts as an employee of the supplier, and he/she has no legal relationship with the client)External auditor vs internal auditor
of proposed
Impartial views (evaluating pros and cons of each possible solutions or products) and choices.Biased view (pros only) and without choiceSenheng vs Sony/Apple Store
education (CE)
SC (20hrs), BNM (20hrs), FiMM (16hrs), FPAM (20hrs)LIAM (30hrs), FiMM (16hrs)Doctors & accountants who needs to fulfill CE points to renew license

Difference between a Financial Advisor Malaysia vs an Insurance Agent?

Financial Advisor is an independent party that provides financial advisory services to the customer based on the customer’s financial needs.
In other words, a Financial Advisor sources for insurance policies and/or Takaful plans from multiple insurance companies and/or Takaful operators that best suit your needs.

An insurance or Takaful agent represents its principal insurance company or Takaful operator and primarily sells insurance policies or Takaful plans issued by the insurance company or Takaful operator it represents.

financial advisor vs insurance agent

The Financial Advisor Difference that matters to you

before engage financial advisor
after engage financial advisor

When to Get Financial Advisor Malaysia?

When you are unable to find enough time or expertise to manage your finances. These are the tell-tale signs:

  • You cannot afford to get distracted; you need to focus fully on your career or business.
  • You want to know how to Strike a Balance so you can fund my child education adequately without jeopardizing your retirement nest egg.
  • You want answers on whether what you are currently doing is enough to retire comfortably.
  • You want help to chart probable Retirement Roadmap so you don’t run out of money before running out of life.
  • You want to put together a Sustainable Income Replacement Plan based on your lifestyle and preference.
  • You want advice on the Cause and Effect of financial decisions you are going to make now.
  • You want to put a Stop to Financial Leakages which compound over time, derailing your finances

When do you need a Financial Advisor Malaysia?

When you need independent non-biased second opinion from a Professional. Here are the common thoughts:

  • My investments are underperforming, what to do next?
  • I need to restructure my portfolio, what’s the better way?
  • Is what I have and am currently doing good enough?
  • Am I ahead or behind other people of my age and profile?
  • Am I over/underinsured and/or overpaying for insurance?
  • Anything I overlooked on my own finances/planning?
  • How to best optimize my retrenchment benefit?
  • Is there any low-hanging fruit I am not aware of, to accelerate towards my financial life goals?
  • Guide me to Reduce Financial Mistakes by leveraging experience from people who’ve ‘been there, done that’

Who needs a Financial Advisor Malaysia?

Malaysians who are feeling stuck for extended period of time, trying to get Actionable Financial Advice & Knowledge. These are what our existing and past clients told us, see if you can relate:

  • I don’t understand financial jargon & how they relate to each other
  • I’m not able to make informed decisions due to information overload
  • I am confused, frustrated & overwhelmed with what’s out there
  • I don’t know how to start
  • I’m not good with numbers, help!
  • I want to grow & optimize wealth with high certainty, ignoring external noises
  • How to best optimize return, with the lowest risk in a volatile market?
  • Help me Catch and Fix Financial Blind-spots before they snowball out of control
  • My accountant unable to do my tax planning, can you help me pay less tax legally?

Why Financial Advisor is Important?

  • Financial Advisor Malaysia can help you detect and rectify financial issues or blindspots before they snowball
  • Financial Advisor Malaysia can help you reduce financial leakages that could compound over time and end up derailing your finances
  • Financial Advisor Malaysia can help you grow and optimize your wealth accumulation journey with minimal risk, and aligned to your risk appetite
  • Financial Advisor Malaysia can save you precious time, allowing you to fully focus on earning money from your career or business

Where to find Good Financial Advisor Malaysia?

Google is your best friend! Seriously.

Do your own background check on the financial advisor Malaysia. See if the financial advisor life values and philosophy on money align with yours. A good financial advisor for you mean his or her values are in alignment with yours as a client.

For example, if you engage financial advisor that believes in live a lifestyle of showing off by purchasing luxurious cars, handbags, or even designer outfits, but if you don’t subscribe to such lifestyle, then you will be very, very disappointed with the outcome because there is this obvious misalignment of values and lifestyle.

For us, we believe in attaining these levels of Financial Life Freedom, in descending order, explained more in the video clip below:

  1. Financial Stability
  2. Financial Security
  3. Financial Flexibility
  4. Financial Independence
  5. Financial Abundance

This, in turn, enable you to attain more…

  1. Time Freedom
  2. Location Freedom
  3. Freedom of Life Choices
  4. Peace of Mind

What are the Requirements to be a Financial Advisor Malaysia?

  • Must be a body corporate with a minimum paid-up capital
  • Must have a minimum professional indemnity insurance coverage in order to protect consumers in cases of professional negligence
  • Subject to compliance with specified licensing requirements for annual renewals

What are the Requirements to be a Financial Advisor’s Representative?

  • Possesses minimum professional qualifications specified by Bank Negara Malaysia, to ensure that they have the appropriate level of competency required to provide advice to the consumers
  • Must fulfill minimum hours of continuous professional development programme annually, to ensure that they continuously maintain and enhance their abilities, skills and knowledge

How does a Financial Advisor & Financial Advisor’s Representative Benefit me?

  • In dealing with clients, a Financial Advisor and Financial Advisor’s Representative must have a reasonable basis for the recommendation they make. They have to take into account your financial objectives, financial situation, and personal needs when recommending a financial product.
  • A Financial Advisor and Financial Advisor’s Representative must take all reasonable steps to ensure that the product he/she recommends is suitable for you, taking into account the information you gave.
  • Clients should provide complete and accurate information to ensure that the a Financial Advisor and Financial Advisor’s Representative is able to recommend a suitable product.

Which Financial Advisor Malaysia is the Best?

You can check out this list or find a financial advisor whom you resonate with at SmartFinance

Can Approved Financial Advisors Handle Clients’ Money?

  • Most Financial Advisor and Financial Advisor’s Representative do not directly handle client monies.
  • For example, when you purchase an insurance policy through a a Financial Advisor and Financial Advisor’s Representative, make sure that the payment is made payable in the name of the insurance company. This restriction does not apply to monies owing to the Financial Advisor or Financial Advisor’s Representative for the advisory services provided to you.
  • For a Financial Advisor and Financial Advisor’s Representative who handle clients’ money, they are required to establish a separate client account to be held in trust, just like a legal firms hold clients’ money into a ‘Client Trust account’.

How Financial Advisor Get Paid?

  • If a Financial Advisor and Financial Advisor’s Representative charges you a consultation fee, it must disclose details of the charges at the outset.
  • If a Financial Advisor and Financial Advisor’s Representative receives commission on insurance products and/or Takaful products sold on behalf of the insurance company and/or Takaful operator, it discloses the amount of commission it receives.

How much does Financial Advisor charge?

Relatively speaking, probably the one with less experience. Then again, fee usually correlates with the scope of advice you need. Here is an analogy – if you order only a fish & chip meal, it is going to be significantly cheaper than you ordering a 5 course dinner.

Also, keep this in mind on Quality, Speed and Price for any service you pay.

financial advisor fees malaysia

When are Financial Advisors Worth it?

Engaging a Financial Advisor Malaysia is worth it when you see Tangible, Actionable & Measureable Monetary Benefit from the consultation fees you paid.

In other words, you end up saving or making more money in the long term.

For example, a RM 2,000 consultation reveals to you a financial leakage that could cost you RM 20,000 in the next 5 years if ignored. This is a 10x ‘return of investment’ from 1 single consultation.

Watch the clip below for a real-figure example

There are also 2 Client Case Studies you can read more on below:

How a Malaysian couple saved RM 2,500 yearly recurring insurance premium

How a HR Manager ‘Gain Back’ a RM 76,000 Lost Opportunity Cost

What Financial Advisor has the Lowest Fee?

If your financial advisor Malaysia is actually a tied financial agent in disguise, then the fee could be zero (aka, Free-of-Charge), but the ‘free advice’ you get also could come with conflict of interest as a tied financial agent can only recommend financial products from the one and only insurance/investment company he/she represents. (see section ‘What Financial Advisor Malaysia should I use?’ above)

17 thoughts on “Financial Advisor Malaysia – Definitive Guide 2023 / 2024”

  1. Hi Sir, does a financial consultant have a basic salary? Or consultants are remunerated on a commission basis? How does the income works if i join as a financial consultant?

  2. Chew Lee Chie Lee Chie

    Hallo sir, can i rely my investment of mutual funds at this platform the FSMone( ifast capital) this conpany is regulated by sc and is a financial advisor recommended by i-invest EPF. I have little knowledge on this company but just what to make sure with you if you have ideas about it. I am quite worry what to do if this company get burst in future, because we are not buying the mutual funds directly from bank. Do you have any ideas?

  3. satrian ravindar

    let say if i would to be a crypto or bitcoin advisor in future… what procedure should i do and what
    should i have?

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