4 Things You Must Know Before Hiring a Financial Advisor | FundsBack
Consultants use their knowledge and experience to develop a personalized financial plan designed to achieve the client's financial goals. Funds Back is a Consulting and Recovery company that helps victims of online scams to retrieve their funds back. These plans include not only investment but also savings, budgeting, insurance, and tax strategies.
- Are you a trustee?
Most people mistakenly believe that all financial advisers should always act in the best interests of their clients. Unfortunately, this is not the case. Only a small number of consultants truly act strictly as trustees. Why is this so important? According to the law, the trustee must always act in the best interests of the client (you).
The easiest way to determine this is to ask the consultant how they are paid. As a trustee, I pay a fixed fee to me as a percentage of the assets I manage or according to the financial plan I complete. I will not receive commissions based on the investments I recommend.
- What is your field of expertise?
The world of financial consulting is too complicated. Professionals who recommend auto insurance may call themselves financial planners, while hedge fund managers may call themselves the same way. Unfortunately, there is no law ruling on this. However, what is the difference?
One is an expert in property and casualty protection and the nuances of using different insurance companies and riders to protect your assets. The other is an expert in implementing strategies and purchasing securities to reduce investment risks. Two different majors, but both can use the same title.
When hiring professionals to help you achieve your financial goals, understand your areas of focus. This is especially helpful in understanding your capabilities and limitations. It can also help you better understand whether you should keep all of your assets for this person or business.
- How does your suggestion fit my financial plan?
Everyone needs a financial plan. It doesn’t matter whether your goal is to pay off student loan debt, buy a home, or keep your investment portfolio for a lifetime.
The easiest way to achieve your goals is to measure your activities and track your progress. Why do you think professional boxers have to weigh themselves every day? They want to know whether they are overweight every day so that they can take concrete actions to achieve their goals. You need to use the same technology to solve your financial goals: precise measurement.
- Where will my money be kept?
Do you remember that Bernie Madoff guy? He is the one who can maintain the Ponzi scheme (return money from new investors to old investors) for at least 20 years while stealing billions of dollars. How did you do it for so long? The most important reason is that your company has acted as an investment advisor and custodian. This means that you not only choose the securities in which the client invests, but also retain the funds within the company.
Several other areas need attention when choosing a consultant, but these are the core issues that anyone should be familiar with.