When you hear the term financial advisor, what’s the first thing that comes to your mind? Do you associate these professionals to larger firms with goals of helping their clients properly manage their investments? Are these advisors only for the rich? The term is comprehensive because financial advisors come with several variations. Plus, they are not only for the super-rich and famous people.
When thinking about how to find a financial advisor, remember that these are advisers who specialize in certified planning. They specifically help retirees plan for their retirement. Some advisers are there to help with taxes, and other general financial analysts help people manage their money. Selecting the right financial advisor is something you should be careful about because this someone will eventually know your personal financial information. And if needed, they can even dig deeper into your saving and spending habits. Here are some handy tips to help you with your scouting for the right financial advisor.
Check for Certifications and Qualifications
In the world of financial advisors, the most distinctive certification is the CFP (Certified Financial Planner). For an advisor to earn this, he/she must have three years of direct experience in financial planning. He/she is also required to attend individual classes and pass a rigid 6-hour exam. CFP holders are also required 30 hours of continuing education.
But more than these certifications, it is an excellent choice to go for financial advisors who can communicate very well. Some advisors meet their clients only once a year; while others prefer phone calls instead of a sit-down meeting. The right financial advisor must be able to communicate with you. Because they are hired to help you in managing your finances and investments. Go for advisers who can talk to you about anything and everything that your money is doing.
Questions You Should Ask to your Potential Financial Advisor
- Are you a fiduciary? Financial advisors who are fiduciaries are potential candidates for your financial planner hunt. Fiduciaries put your interests at heart because these professionals are not motivated by sales commission and other payment incentives.
- How does the advisor want to get paid? The best part about fiduciaries is that they do not charge too much.
- Can I benefit from technology? Some investors want their portfolios to get managed the old-school method based on survey answers and questionnaire. But in the advent of technology, an excellent financial adviser must remain on top of his/her game and he/she should take advantage of the benefits of technology.
- Do you help pay taxes? This is one question you must not forget to ask your financial advisor. Your planner should also help you boost your financial portfolio regularly for tax purposes.
But why should you choose a financial advisor? It is easy to claim that you can easily manage your finances by yourself. However, if you lack proper training, the possibility of making your own decisions that do not help maximize your financial plan is very high. To be on the safe side, just trust and leave these concerns to the professionals.
Thinking about how to find a financial advisor? It’s relatively easy, as long as you know what qualities to look for in these professionals.
