Choosing A Financial Advisor

In order to achieve a happy secure financial future you need to set your financial goals.  Where do you hope to be financially in five years, ten years or at retirement?  What about the financial resources to help you child or children with a college education?

It is possible to set up your own financial plan.  To have a chance at succeeding at this you will need to do research and learn as much as you can about investing for the future.  You will need to be aware of tax implications from various investments.

It is much easier and usually more profitable to hire a professional financial planner or advisor.  When you are looking for a financial advisor keep in mind that some are better than others.  You want to be sure you are receiving the advice that is best for you from a professional who is knowledgeable and who has your best interests in mind.  You may have a friend who can recommend their own financial advisor who has proved to be working successfully for your friend’s benefit.

Some financial advisors work on a commission basis.  This is not necessarily a bad idea, but you do not want a financial advisor who is acting more like a salesman.  You do not want someone who is trying to sell something to earn his commission.  You want your advisor to provide you needed information that is going to benefit you.  If he is trying to sell you something that does not feel right to you then do not buy.  After all, it is your money and your financial future.  Therefore, it is your decision.

A financial advisor may be either a tied agent or an independent agent.  If the financial advisor is a tied agent he is tied to a specific company and only recommends products or services that are offered by that company.  This agent may be biased as he may be looking to promote his company’s products and may not be looking out for your best interests.

The tied agent will work for your best interests if these interests fall within their product line.  He will recommend the best product for you, but only among products his company sells.  The tied agent does not need to recommend the best product for you if that product is outside his company product line.

The tied agents do have some benefits.  They can find some very attractive deals within their product line which will suit your financial needs.  They are also able to get some very good deals for you with their products.  Just bear in mind that a tied agent’s advice is not unbiased.

The independent agent is not tied to any one company and can sell you products and services from any company.  He works with multiple companies and can search the products and companies to find the right financial product for you.  The independent advisor is probably paid on a commission basis and may promote the product or service that will give him a higher commission, but may not be the best product for you.

Financial advisors are a great resource for setting up a financial plan to reach your goals.  Just remember you want a service or product that is going to benefit you and not one that is benefitting your advisor.  Take your time choosing your financial advisor.  You will be working closely with him for a long time as you work toward attaining your comfortable financial future.  Ask questions as you feel the need.  You want to be able to know that your financial situation is under the guidance of someone who is interested in helping you attain financial security.