How to Choose a Financial Planner |
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Looking for a financial planner? How do
you differentiate a professional from a salesman? The critical
features of professionalism are impartiality, expertise and the
ability to offer a range of solutions. Provide Relevant AdviceThey need to be able to advise as to what the risks of these options are and the probability of achieving your objectives. They need to know what costs and charges are involved and the alternatives to solving the problem.Importance of Emotional NavigationAside from dealing with just facts and figures, the adviser needs to know how to navigate emotional psychological impediments that investors face in achieving their goals. And all these come with experience.Find Someone You Can TrustInterview and talk to more than one financial planner. This is because of the nature of the business where a client has to reveal to the adviser his financial condition, his past financial mistakes and future dreams. Find someone you can trust and like. A lot of times, financial planners are accountants to families where a relationship has been established.Plan First, Sales SecondIn theory, the financial planner should look at the best financial plan for the client and offer a broad spectrum of choices. They should emphasize financial plan first and product selling second.Declare How They Are CompensatedFinancial planners must disclose in writing what they receive as well as what their affiliates - for example, solicitors and fund managers - are receiving. Ask the adviser to clarify how they are remunerated. Also, make sure the adviser discloses the ownership links of his practice. Are they obligated to sell the holding company's products? What do they get from selling these products rather than somebody else's products? It is not rude to ask for these things.Interaction Between You and Your Financial PlannerThe client needs to be empowered to ask and not be afraid of jargon. Professionals should be proud of the fact that they have impartiality and standards. They should be pleased to be asked. If they have nothing to hide, it builds the client-adviser relationship.
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