Selecting the right financial advisor for you is essential to set both short and long-term goals for your financial success. By consulting with a financial advisor, you will be privy to valuable information on loans, consolidation of debt, investments, securities, and standard regulations on your savings and other accounts. A financial advisor or representative can guide you towards smart decision making, secure investment strategies, and building your personal financial portfolio. They can be a great resource for mapping out your retirement goals, as well as taking care of current interests, trends, and managing your debt.
Before you approach a financial advisor, here are some key Do’s and Don’ts as you begin your relationship:
Do ask for references; especially if your advisor works independently, it is essential that you learn about their credibility and integrity as an expert. Consul their referncesa as needed, and seek out referrals.
Do ask if your advisor works independently, or is affiliated with a bank or organization. This will make a difference in their commission structure, fee for services, and what type of products they can or will offer you. This will also give you an opportunity to understand how your decisions will be insured, and what costs/risks may be associated with your portfolio.
Do find out what type of clientele your advisor typically handles. Do they focus on long-term, or short-term investments? What are their goals and priorities when it comes to risk management, consulting with clients, and managing portfolios? Don’t be afraid to ask about what they can offer you!
Do work together to create a solid financial plan. This can be a written document, or blueprint, for your goals and investment strategies. A good financial advisor will already have a template or spreadsheet-style document available, so don’t be afraid to take the time to plot this together.
Do ask how they plan to inform you of changes, news, and laws. A financial advisor shold be well-trained and current with national trends, news, and information; they should be able to extend this information to you as needed, and may even offer seminars or lectures locally on various topics.
Do request an initial meeting or consultation. This will give you the chance to gauge how you will coordinate future meetings, how often you need to consult with them, and also learn of their availability. The initial meeting can bring you to ask additional questions on goals and objectives as well.
Don’t assume that you are aware of all laws and regulations without a financial advisor. It is their job to be current and up to date in this area, and you will gain valuable information by consulting with a financial advisor for this. Professional advice is very valuable if you may be dealing with death, divorce, retirement, and long-term investment solutions.
Do establish your net worth. Your financial advisor can draft a formal sheet that outlines your net worth based on your assets, liabilities, and current or projected investments. This is a great tool and resource for obtaining future loans, investments, or coordinating financial projects.
Don’t overlook the possibility of fees and charges. Many financial advisors do work on an ongoing commission-based structure; by nature of their jobs, they will offer you a variety of products and services at additional costs. Ask questions, and find out how valuable each product or service will be to you over the long-term. If it is a wise decision, do learn about your financial advisor’s recommendations through online research, or referrals.
Do make sure your financial advisor is asking the right questions! Their focus should be on better understanding your portfolio investments, how soon you may need cash or liquidation of your current assets, and what can be realistically achieved with your current standing.
Make the relationship with your financial advisor an ongoing and beneficial one by working together on your goals. You may need to seek this professional advice even if you have small investments; the right approach to long-term planning can be very rewarding and help you make sound financial decisions. Selecting a financial advisor doesn’t have to be difficult and the best relationship will develop naturally. Always remember to check references and credentials, and do be sure to solicit referrals from friends and family.