When it comes to planning you finances it will be best if you
seek help of a financial advisor. Not everyone has knowledge about financial
matters and it will be better if you take professional advice for managing your
finances. By managing your own finances or taking advice from friends and
relatives, you may not be able to successfully manage your finances and thereby
miss your goals.
As explained financial advisor are your saviors when it
comes to handling finances, however, it is equally important that you find the
right one. The financial advisor must be capable of knowing what kind of
investment would be suitable for you. If you too are planning to approach a
financial advisor/planner here’s what you should consider.
1) Professional
qualification
Your advisor should ideally have qualifications such as
Certified Financial Planner (CFP), Chartered Financial Analyst (CFA), etc. This
will make sure that they have good knowledge about this field and about the
market and will be able to give sound financial advice. Their experience in
this field can also be considered.
2) Services offered
Check what type of services they are offering and whether it
matches your requirement. These services include investment management, tax
planning, insurance, etc. Some advisors may be offering only one or two of
these services while some may offer all of it. Ask whether they will handle
documentation and other such processes. Also ask if they have any tools such as
website and mobile apps which will help you to keep track of the services
offered by them.
3) Robo-advisor or
human advisor
Many firms nowadays offer robo-advisory service which
investors can use as an assistant for planning their finances online without
any human interaction. This is done by asking investors some computer generated
questions related to service required by them which can be answered digitally.
Robo-advisor service generally costs less than human advisors. You can select
what type of interaction suits you best.
4) Strategy used
Learn what kind of investment strategy they use for
different types of investors. Some investors are willing to take risk while
some prefer to be conservative or moderately risky. Some are big investors
while some are small investors and each has different financial goals. The
strategy used should be customized accordingly.
5) Learn about their
clients
Learn what types of client they handle and how long they
have been in this business. You can ask how much their clients invest as if
they handle only high networth individuals (HNI) and you are a small investor,
it might not be a good match. The same will be true the other way round as
well. This will give you assurance that they have worked with clients similar
to you and have the relevant experience.
6) Skills and
abilities
Ask them why you should choose them instead of their peers
and what makes them stand apart from the rest. This will help you to better
know about their skills and abilities and special services offered if any.
