How to choose the right financial advisor

3 steps to choosing the right Financial Advisor that can save you a lot of time and money.

This is a question that you’ve no doubt googled if you ever thought of hiring a financial advisor because let’s face it… You don’t have to look far to find one, but who can you trust to help you make better financial decisions?

In the data-driven world of today, with social media strategies, perfectly written copy and behavioral advertising, how do you actually find the right financial advisor or wealth manager or broker or financial planner or investment advisor or financial coach.

How do you find the right person that can help you define your goals and help you create the plan to get there considering debts, taxeswealth strategy, investing, buying financial products and all the things that go into financial planning for your financial future?

Let’s address this from a real perspective, can you do your own financial planning, the possibility of what you could do yourself when you need to see a financial advisor and what you need to know to choose the right advisor for you.  

So let’s face it, it’s very easy to manage your own money and develop your own financial plan for the most part because principals of money management and creating wealth are straight forward, save more than you spend, build up enough for emergencies in a safe place, invest the rest in different places, there are many places you can invest directly with online.

Don’t do debt or don’t do it without a plan, protect your income and if you do this and maintain it you can be financially free. Accumulate assets and have a plan to distribute those assets, life will be ideal.

Now with all of this available, the reality is not everyone is built to automatically do this themselves and if there was any truth in the saying it takes a village to raise a child. 

It’s fundamental to accept that your journey to living life on your own terms financially free considers guidance along the way. Especially when it gets more financially complicated in which case we all need help and advice when making decisions with our money.

Here are 3 steps to choosing the right financial advisor that can save you a lot of time and money:

Know what you’re working towards

So before choosing a financial advisor the first thing you should do is to start with what you want. You can’t trust someone to help you make better financial decisions throughout your journey if you don’t know what you’re working towards.

And more often than not people are contacted by a financial advisor as the first point of engagement.

Here’s an example:

Financial Advisor: “Good day Mr Duffy you’re speaking to Ben, the reason for my call is I’d like to give you your dream financial freedom and save you millions on your retirement products, all I need is one meeting”

Carl: “I have an advisor”

Financial Advisor: “Yeah what’s his name”

Carl: “Uh I don’t know but he sold me insurance and my investment portfolio”

Financial Advisor: “Oh that’s awesome but you know we’ve been saving clients 50% on their investment costs, it’s 2020 when last have you cut costs on expensive products? We do holistic planning you’ll remember my name, I need 15mins of your time to help you become financially free sooner. How does that sound?”

Carl: “Oh really?”

Carl: “Is there anything I need to prepare?”

This is the reality for most people and it’s believed to be financial advice but in reality, it’s just financial product information.

Now that’s actually not a bad thing if you feel the upcoming session will get you to consider your finances more seriously and perhaps you could learn something about products but chances are that person is going to be of little value to you in helping you make better financial decisions in your life with money.

So you need to prepare and consider what you want from that session. Or it’s like a doctor showing up and saying hey, your health is important, why don’t you buy an MRI and my medical offer that ties you into dealing with me forever.

You’re setting yourself up to lose by starting down the wrong track if you don’t know what you want.

Decide on the type of advisor

The second thing you need to do is decide on the type of advisor you need. There are two types of advisors, good ones and kuk ones.

Here are 6 qualities that make up a good financial advisor:
  1. A good financial advisor or planner will get along with you. If you don’t feel connected then you’re not going to reach out for advice when making decisions. It shouldn’t be a one-sided feeling engagement. They will relate with your goals and will provide clarity on your plan and the steps to get there.
  2. They’ll have time for you. Money matters are not a one time job. You’ll need to engage with them through all of your decisions so availability does matter. Good advisors may work with many people but have exceptional organsational and planning skills.
  3. They have in-depth expertise in their field and will be able to demonstrate that through first-hand experience. On top of the expert knowledge, they will educate you and help you grow in your perspective by helping you consider all the angles around strategy, the financial tasks at hand and how it all connects in your life and business as the future is changes.
  4. They have the ability to listen. It’s easy to talk about benefits and ideas especially if the advisor has more knowledge than the client on the subject matter but remember this is about you. Listening to you will ultimately help them help you lookout for that.
  5. They will have valuable networks if you need to tap into them for a solution. One person cannot be a specialist on everything and a good advisor knows this and will help you orchestrate your financial decisions.
  6. They’re passionate about what they do and get excited about solving your problems and help you get to your next level. It’s what makes them effective in helping you set goals and understand what it takes to achieve them mentally and practically.

Remember guys an advisor is not there to promise you anything besides comprehensive factual and valuable advice around your plan with money.

Understand what you’re paying for

And finally, the third thing you need to do is understand and accept how you’re paying for advice.

If you don’t know this already the financial advice industry has been changing over the last decade, professionalising itself and moving away from commissions and toward advice fees.

And the truth is that as long as you find a good advisor it doesn’t matter whether they are fee-based or commission-based because firstly, that’s just how they make their money and they will be clear about this with you. If they’re good they’ll do what they’re supposed to.

And secondly if you’re lucky you’ll find a good advisor who is commission based because it’s actually a lot cheaper to use an advisor who does all the work and only earns on your products.

Perhaps you just need a coach who can help you make decisions and guide you along your financial journey and that will direct you to the right products.

For your clients who do coaching, you don’t want them to feel like they’re being taken for a ride because they pay for coaching and buy products.

On that note let’s recap:

A proper financial advisor needs to be someone you turn to before making any financial decision so figure out what you want first before engaging.

Find a good advisor based on their advice skills and stop buying into everyone else’s opinions and learn how to make a decision for yourself on which advisor is better for you.

Because it’s easy to plug into a financial advice business as a prospect and have reports printed out with shortfalls and be another number in the process.

So, if you’re looking to make better financial decisions head out to My Money Talks where you can request to compare financial products. Send us your review and suggestions so that we can make it better for you.


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