Make a List of What You Need Before Going to a Financial Adviser
Are you your own worst enemy when it comes to financial matters? You might be if you are moonlighting as your own financial adviser and the job is not getting done. People would never assume that they could construct their own house, yet they go ahead with constructing their own business plans [3] or handling their financial situations. Thousands of businesses go out of business each year, because their owners thought they could be expert financial advisors. Before you move forward towards a path of financial stability, you’ll have to do one thing: fire yourself as your financial advisor. Not sure if you’re ready to do it?
Signs That You Don’t Know What You’re Doing
- Are your assets consistently underperforming?
- Are you using computer programs that cannot judge the emotional nature of the market?
- You are hazy with the concept of "asset allocation"
Once you’ve fired yourself, you are ready to find a financial adviser. However, you don’t want to run off into the sunset with the first one you meet. Look around.
Signs of Bad Financial Advisers
Getting a clear idea of what makes a financial adviser bad will help you choose one suitable to your needs.
Bad Financial Advisers
- Create portfolios that contain one type of investment. If someone creates a portfolio for you with one type of investment like mutual funds, then he is a “product salesman”. Steer clear.
- They have no plans for a distribution strategy for your IRAs [4]. Find an adviser that can create a strategy for your pre-tax accounts to limit the amount the government takes.
- They never ask to see your tax returns [5]. Hello. This is a red flag. Financial advisers should be keeping up on tax laws and working with you to save you money by pointing out missing deductions or seeing if you are paying too much.
Finding a Financial Adviser
Ask people you know and trust. Don’t ask someone who’s recently gone bankrupt. Talk to people who are doing well. Look up your financial adviser in a professional association such as the National Association of Personal Financial Advisors or Garrett Planning Network. Before going to a financial adviser, figure out what you need. Do you need the whole kit and caboodle or one specific thing like estate planning? Make a list of what you need BEFORE going? Avoid getting talked into buying some property down in Florida. Do you have any ideas about finding a financial advisor? Please share your thoughts and comments.