The choice of a financial adviser is a rather delicate, complex and vital issue. So, tips for choosing a financial consultant like Matthew Feargrieve. Imagine that you own a portfolio of financial assets worth $ 500 thousand (including retirement accounts), a house, ordinary debt obligations and stock options. At some point, you wanted to evaluate how rational your current investments are, whether pension funds are sufficient savings and what other steps should be taken to increase the effectiveness of your investments (for example, is it worth it to purchase a long-term insurance policy or insure your life). So, having read all kinds of advertising brochures, you choose a specialist who has extensive experience, who provides you with a huge number of recommendations from your clients, is a respectable citizen, just seems to you to be a nice person.
The Issues for You
Here’s what to expect in this situation: most financial advisors and advisers (depending on who you choose) are either brokers or insurance agents. Their job is (and evaluated accordingly) to convince you to change the structure and direction of your investments, even if you shouldn’t. In addition, some consultants evaluate their services on the same principle as accountants and lawyers usually do, i.e. on an hourly basis. We recommend using a few tips that will help you better navigate the proposals of all those who call themselves financial consultants.
- Do not rely on good recommendations. It is likely that your brother-in-law praises his consultant in every possible way, but until he talks about his specific investments and their real benefits, his recommendations will not be more reliable than the advice of a person who claims that his mechanic is better than anyone because he has a technical assistance machine. Rely on friends’ recommendations only when you know for sure that they understand the subject of discussion.
- Do not pay much attention to diplomas and certificates. In itself, a financial advisory position often means that a person has the appropriate license, that he has passed a huge number of exams or participated in many conferences, such as those that are constantly held, for example, in Palm Spring (California). Instead of relying on his diplomas and certificates, ask this specialist what he did before becoming a financial advisor. Most people come to this field of activity from the sphere of trade, but every year more and more consultants have experience as an accountant, engineer, teacher or lawyer, and, taking into account their previous specialization, you can take advantage of his professional knowledge.
- Red flags. Stay away from any consultants trying to sell you stocks with a very low market price, tax lien rights, various coins, art objects or racehorses. Remember that any person who claims to have a thorough knowledge of markets or some kind of “secret” strategy will surely turn out to be either a fool or a fraud”. The selection of candidates is proposed to be divided into three rounds.