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Do you know your parents’ financial advisor? Is he a friend of the family? Has he served your parents for decades?
Don’t you want one of them? After all, if you have money, you need to pay attention and you can use a stable guide. After all, you really want to retire.
You may know someone who has the perfect financial advisor. However, this relationship does not only happen. They happen through research and a full understanding of your financial advice needs.
These 5 questions will help you find a financial match
In order to find the best consultant for your situation, you must first know why you need help. Then, you can also ask the financial advisor a few questions. These are not necessarily literal questions you want to ask, but whether you are getting answers from financial professionals, searching the Internet or talking with other customers, you need to know the answers.
No. 1: Why do you need a financial advisor?
Whether it is an increase in income, an inheritance, or you have reached the age to be considered for retirement income, you have one or more reasons to want to use a financial advisor. Ask yourself why.
Make a list. You will find the right financial adviser only if you know what you want the adviser to do for you. Whether it is a retirement plan, a child’s education budget, or your new interest in investing, the relationship with a new financial advisor will only work if it is beneficial to you.
Before you start researching possible candidates, figure out what services the consultant needs. Your personal needs will narrow the scope of candidates and point you in the right direction as you search for candidates.
In addition to your current financial consulting needs, you should also consider other things. Do you hope that the financial adviser you find in the next few years will be with you? If so, you should consider the age of the people you are working with, and finally ask them about their career intentions after retirement. You don’t want to get into trouble again and go through this process again.
Question 2: “Are you a financial consultant?”
Haha! This is a question of skill! There is no such thing as a “financial consultant”.
At least not Securities and Exchange Commission Be concerned. Absolutely anyone can call themselves a “financial consultant” because there is no standardized definition of the term.
However, there are many other really regulated terms that require a lot of research (sometimes several years), and come with all these cool initials, the first letter of which follows the name of the financial professional you find.
Although anyone can call themselves a financial adviser and get out of trouble, what you want to find is a registered financial planner. CFP must receive 1000 hours of education and must pass the exam provided by CFP Certified Financial Planner Standards Committee.
Remember, CFP works hard to provide his services, and you will pay more (most likely) to obtain these services.
In addition to receiving education and dedication to work, CFP must also comply with Fitness standards, Which means that they will always put the interests of customers first. Not all financial professionals comply with this standard.
You can also look for CFA, a Chartered Financial Analyst, who has been in the investment profession for four years, after which he can even apply for CFA certification. Similarly, you should decide whether you need this level of investment advice.
What you may need is a personal finance expert (PFS), he is a certified public accountant, he also has wealth management and personal finance experience, including insurance, budgeting and investment. This may increase your speed.
Question 3: “Are there any complaints against you?”
Many people have never hired financial experts to help them solve their personal financial problems because they are afraid of being used by others, or afraid that their savings will be stolen directly. However, when you are ready to consider hiring your personal financial advisor, you can determine whether your candidate has already had a client appealing to it.
website brokercheck.finra.org Allows you to type the name of a financial adviser or provider in a search engine and check with the Securities and Exchange Commission whether there are complaints about that person or company.
It is a non-profit organization authorized by the government and links to other websites to provide consumers with information to protect them from the rats that give financial advisers a bad reputation.
Question 4: “How do you make money?”
Not long ago, this problem could be boiled down to “fees and commissions”, which meant that they had to pay consultant fees for every action they took in your name, and they had to pay commissions for selling their investment products.
Today, most financial advisors work on a fee-based system, but you must determine which services you are willing to pay for. Do you need a budget, retirement plan, investment plan, education funding plan? Each of these services will have a price, and you should ask your consultant candidates exactly how much each service will cost you.
Even better, there may be a published fee schedule on their website.
Question 5: “Are you listening to me?”
Surprisingly, this is a reasonable question and the most important one.
Successful financial advisors can work with dozens or even hundreds of clients, and they may believe that they know what is best for their clients. However, what is suitable for one customer is not necessarily the most suitable for another. You have decided what you want your financial advisor to do for you, such as helping you prepare for retirement or getting a college education for your baby. Is he or she willing to do what you ask of them?
If you want to restrict your financial adviser from playing a specific role in your financial plan, will he accept the decision, or will he plan to sell you or push you into other services that you have determined you do not want or need now?
If your financial planner is looking for investment for you, does he or she understand your risk tolerance? Will your financial adviser candidate answer “No”?
There may be more questions
After one or two interviews with financial advisor candidates, you may ask more questions that need to be answered. That’s very good! This means you understand the process better now than before and can make more informed decisions in the future.
Kent McDill is a senior reporter who has been focusing on personal finance topics since 2013. He is the writer of “The Penny Hoarder” (The Penny Hoarder).
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