It is critical to make investments to expand your money to achieve financial freedom. Prudent use and growing our financial strength through planning is a crucial aspect of our daily life. Investment in other things rather than conventional means has become so important considering the inflation, insurance needs, and retirement plans. Now, the conventional options such as RD, FD, and Endowment plans have become less profitable and some give a negative rate of return. So, people are shifting to gold, real estate, equity, derivatives, bonds, currencies, and antiques. For making the best out of your money, it’s critical to enlist the help of an investment advisor.
A professional advisor can help you organize your finances and achieve your short- and long-term objectives. A Financial Advisor’s job is to manage money by assessing risk, comprehending macroeconomics, and keeping an eye on future growth. Overall, it’s a role with several facets. Here are five suggestions that will help you in picking the right financial advisor.
Checking and verifying credentials:
The foremost thing to do is to verify whether or not the financial advisor has the requisite certifications. For unversed, a financial advisor must have certain certifications and he must be a SEBI-registered investment advisor. In terms of qualifications, the Certified Financial Planning certification from the Financial Planning Standards Board is a worldwide recognized certification that fulfills the global standard. Another thing to look for is a CFP certification, though it isn’t essential because financial planners can come from any field.
The fee structure is a big decider:
Keep in mind that financial advice isn’t free. For rendering services, a financial advisor will charge an amount. If a financial counsellor is offering service free of charge, then he/she is working for any firm on a commission basis, which can impact the objectivity of an advisor. Some financial planners, on the other hand, charge a fixed amount, whereas others charge a share of the assets they manage for you. So, before taking service, be clear on the cost structure and method of payment. It is, however, preferable to pay the advisor monthly.
Look for a financial planner who has experienced several market cycles and understands how different asset types have performed throughout those times. Deep knowledge of the cyclic market will keep your money safer. So, choose an advisor with at least 5 years of client-advising expertise.
Meet in person, if possible:
It is imperative to meet the financial advisor in person or through a video conference. During this meeting try to figure out, how comfortable your advisor is while talking to you and giving advices. Ask your planner about the review timing and frequency.
Be sure before finalizing the advisor:
A double-check is essential for the best decision-making. For Making a better choice, get reviews from the advisor’s existing clients about his or her past performance. Observe, how the financial advisor takes the time to understand the client’s concerns and engages in meaningful dialogue with them. For a wider view, check the advisor’s public profile, as well as reviews and ratings.