Decide what you need, then do your due diligence to guarantee your financial health
Managing your investments can be complicated. So can figure out how to increase your income to meet all your expenses as well as your goals. Therefore, you may consider working with a financial advisor as statistics show that those who do are more prepared and have better financial health.
Here are five questions to help you do that.
- Why is financial planning important? A financial advisor will work with you to create a detailed financial plan. The advisor assesses your current situation and determines your current and future goals and needs before advising you on the best financial products to meet them. A good advisor takes a global look at your situation – which may include retirement planning, debt repayment, insurance tips to protect you and your family, and estate planning – then periodically reviews your plans and investments. Do it and ensure that you are staying on track to meet your goals. Because this is their wheelhouse, they have a lot of knowledge to get you wherever you want.
- Which life events require financial planning? Before you talk to a financial advisor, decide which area of your financial life you need help with so that you can explain it to the advisor you’re looking for. Whether you’re paying off school debt, getting married, buying a home, starting a family, or looking to set up a college fund for your kids. You may also have some bigger life goals that you want to finance – like relaxation or some travel – or you may want to start planning for your retirement. You may also be working through a difficult tax situation or dealing with young adults or aging parents who need support while keeping themselves on track to reach their goals. A good advisor will look at your complete picture and make sure it all fits together, so you stay in the best financial health possible.
- When should you get a financial advisor? You can start working with a financial advisor at any age or level, but the sooner you do, the more confident you will be that you have a good plan and that you can achieve it. So, you can find one when you need budget help, debt management, investment advice, insurance coverage, college planning, tax planning, retirement planning, or estate planning, but then make sure they see the full picture of you. so that you can balance all the pieces.
- What are the qualities of a good financial advisor? Choosing the right advisor is a personal choice. It depends on what kind of help is needed and who is skilled in providing it. But it also depends on what qualities you prefer in your helping professionals as it can be different for everyone. So, ask friends and family for recommendations, then meet with several counselors to check for fit. You want to find someone who has the experience and expertise you need, but who you are comfortable with – because the more you share, the better your financial planning and success will be at meeting your goals.
Some things you can check are:
- How big is their business – the dollar value of the client and assets under management?
- What areas do they specialize in?
- How much training, experience and passion do they have for what you need to address?
- How important is it to them that your interests align?
- How well do they communicate?
- How curious are they about your situation and needs? Do you feel heard?
- How much are they “selling” to you?
- What questions should you ask a financial advisor? You should ask a number of questions to consultants to determine if they are qualified to do what you need or are the best fit for you. Take notes and compare answers, and wait until you think you’ve found the right fit before signing in. Ask:
- What is your education and professional experience?
- What is your designation or certification?
- How long has your firm been in business? How long have you been with it?
- Are you or your firm registered with a securities regulator?
- What kind of clients do you usually work with?
- Do you have a minimum account?
- Do you have a conflict of interest with my money management?
- What products and services do you offer?
- What is your approach towards financial planning?
- How will you help me reach my goals?
- How do you decide which investment is right for me?
- Are you licensed to sell any other products?
- How do you get paid? the wages? commission? Other charges?
- How often will we meet?
- How will you keep me informed?
- Will you collaborate with my other advisors?
- Do you have references from past customers?
- What kind of information do I need to give you?
- have you ever been in:
- Has been disciplined by a regulator?
- Were there any restrictions, terms or conditions imposed on your registration approval?
- Currently being invested by Canadian securities regulators?
So, think about what you need — and why — and then do your homework to find the right person to help you. Once you find it fit, you’ll be glad you did like you’ll be on your way to building your great financial health!