Few tips to choose a financial advisor

It may sound crazy to give someone 1 or 2% of your total assets to manage them but, believe me, by doing so you will get a lot of financial advice about almost each and every financial situation. Financial planners advise clients on how to save, invest and grow their money. They can also help you tackle a specific financial goal. While some financial advisors are best in providing retirement planning or estate planning, others can offer you a range of financial planning services as well as offshore financial planning services. However, before you head out and look for such services, it is necessary to know how to choose a financial advisor or planner.

First of all, don’t get confused with stockbrokers. Financial planners differ from accountants that can lower your bills, insurance agents that lure in several insurance policies and professionals urging you to buy mutual funds. Ensure to look out for a financial planner who has CFP credentials short for Certified Financial Planner. A CFP is a financial advisor who has passed a test administered by Certified Financial Planner Board of Standards. The CFP credential gives you an assurance that the chosen financial advisor will provide sound financial advice.

Now, remember to consider the planner’s pay structure. This is another aspect of choosing a right financial planner. An advisor who makes money through commission rather than a flat or hourly rate can have an incentive to steer in a particular direction. The financial advisor investments who work on commission are usually not the most unbiased source of advice. They may steer your direction based on their profit percentage. Most of the acknowledged financial planners make money only when someone pays them the fee for their sound advice.

Try to know a little background of your planner. You should collect as much knowledge as you can. Visit their website, look for client testimonials, talk to some previous clients and ask them about the planner you have shortlisted. Ask for references of current clients whose financial needs match your requirements.

Lastly, a financial advisor can help you remain disciplined about your financial strategies and achieve a certain goal or desired position. However, you should look out for only certified financial planners, so that, in situations when the economy or market goes down, it doesn’t have much impact on you and your financial status. Consider these steps while choosing a financial advisor and remember a reliable financial advisor should be promising in offering sound advice not just related to investment but in a range of issues.

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