How to Choose A Suitable Financial Adviser

Have you been thinking about hiring a financial adviser but aren’t sure where to start? Choosing a suitable financial adviser for you is an important decision, after all, they will be helping you plan and provide guidance on your financial future.

The good news is that if you go in with a set of criteria to evaluate potential advisers and ask the right questions, you will be able to find an adviser you can trust and connect with. Here are some key factors to consider as you embark on your search for a financial adviser.

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Experience Level

Experienced Adviser

When looking for a financial adviser, experience is one of the considerations. An experienced adviser will most likely have guided clients through good times and bad, gaining valuable knowledge along the way. They’ll have a proven track record of success and be able to provide references from long-term clients.

An experienced adviser will be able to give you personalised advice tailored to your needs and financial situation. They can recommend investment strategies, protection plans, and retirement plans based on what has worked for clients with similar goals. They’ll know how to minimise risk while maximising returns to help you build wealth over the long run.

Search for a certified financial adviser, planner or consultant and check their background and credentials. ?Look for reviews from their clients about their level of service and communication. You want an adviser who will guide you through major life events like having kids, buying a house, changing jobs, or planning for your retirement.

When evaluating potential financial advisers for yourself, ask about their experience in helping people in circumstances similar to yours. Find out what makes them unique. An experienced adviser will be able to articulate their investment philosophy clearly and provide a tailored plan to help achieve your key financial objectives.

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New Financial Adviser

As an alternative approach, hiring a financial adviser who is new to this industry can offer fresh perspectives. While experience is valuable, a new financial adviser may bring innovative approaches, a willingness to go the extra mile, and a strong desire to build their reputation.

This can translate into personalised attention and dedication to finding the best plans and solutions for your unique needs. Evaluate the ability of your potential advisers based on objective yardsticks and on how they are able to demonstrate their ability to you.

Understand How Your Financial Adviser Charges Fees

When choosing a financial adviser, understanding how they charge should be another consideration.

There are three common ways advisers charge:

• Commission: Your adviser earns money based on the investments or insurance products you purchase from them.
• Fee-based: Your adviser charges an ongoing fee, usually a percentage of the assets they manage for you.
• Hourly rate: Some advisers charge by the hour for financial planning services.

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The best approach is finding a suitable adviser with a transparent fee structure that aligns with your needs and values. ?Don’t be afraid to ask direct questions about how they make money and what incentives they may have to promote certain products. ?Your financial well-being depends on finding someone you can trust, so take the time to understand their business model fully before engaging in their services.

In the end, knowing your interests are being well-served and your hard-earned money is in good hands is how you’ll be able to sleep peacefully at night.

Find A Financial Adviser Who Aligns With Your Goals

When choosing a financial adviser, one of the most important factors to consider is their investment philosophy. You want an adviser who understands your goals and how much risk you're comfortable with. This way, they'll make decisions that match what you're looking for in the long run.

Having open conversations with potential advisers about your financial goals and how much risk you can handle is key. ?It helps ensure they create a financial plan and protection plan that's just right for you.

Long-term, Diversified Strategy

Seek out an adviser who takes a long-term, diversified approach to investing. Short-term trading or risky bets are unlikely to achieve your long-term financial goals. ?A suitable adviser will develop a personalised investment strategy focused on asset allocation, diversification, and minimising fees.

They should instinctively consider your age, financial situation, and risk tolerance to build a suitable portfolio. It's about spreading your investments across different instruments to secure your financial future.

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Safeguarding Your Wealth?

Your financial well-being isn't just about growing wealth; it's also about safeguarding it and being able to pass it on to your loved ones.

A prudent protection plan incorporates the establishment of an emergency fund, mapping out retirement and protection plans. Your financial adviser should emphasise the strategic importance of maintaining a cash reserve. This reserve is designed to cover unexpected expenses or temporary income loss, strategically preventing the necessity to dip into long-term investments during challenging periods. This is a safeguard that will ensure your overarching financial goals remain intact.

Estate planning, although not always at the forefront of everyone's considerations, is an integral facet of protecting your assets and ensuring your wishes are honoured. Your adviser should stress the importance of making or updating key documents like wills, trusts, and powers of attorney.

This careful process not only strengthens what you leave behind but also makes it easier to pass on your assets to your intended beneficiaries smoothly.

As risk is an inherent component of financial planning, your adviser should work with you to identify potential gaps in your financial well-being.

Recognising that protection and retirement planning is not a static endeavour but an ongoing process, your financial adviser should conduct periodic protection strategies that evolve with the shifts in your life, financial situation, and the broader economic landscape.

This process allows for thoughtful adjustments, maintaining a robust and finely tailored strategy aligned with your enduring financial goals.

The Singapore College of Insurance (SCI), a renowned institution celebrated for its commitment to excellence, offers a comprehensive range of courses for financial advisers which provides the knowledge and skills required as well as valuable insights from industry leaders and visionaries. ?This ensures that your trusted and qualified financial adviser is equipped with the knowledge and expertise needed to guide you toward financial success.