Choosing a financial advisor is about more than just financial return forecasts, according to Jason Pereira, senior partner at Woodgate Financial. He believes potential investors should take a more holistic approach, looking for advisors who understand not only their financial goals, but their lifestyle and personal circumstances as well.
Sure, positive returns are important, but an advisor’s knowledge about a client’s lifestyle, aspirations, and personal circumstances can help deliver a more tailored and realistic strategy. Transparency, regular communication, and good customer service are other key skills to look for, alongside considering the advisor’s track record and qualifications.
Prospective advisors should hold proper qualifications, such as the Certified Financial Planner (CFP) designation. It’s also worth considering any formal disciplinary actions against advisors, fees or commissions, and their experience within your areas of interest. Good financial advisors aren’t just there to manage your finances, but to guide you toward your financial goals.
John Webster, president of Queensbury Securities, cautions against being misled by titles like “senior financial advisor”. Such a title might suggest industry experience, or a focus on elder clients, hence, it’s key to look at an advisor’s career history.
Holistic approach to selecting financial advisors
Digging deeper into their past work, credentials, and current client base can provide valuable insights.
Also, an advisor’s expertise should align with your personal financial objectives. So, make sure to evaluate their track record, skills, and comprehension in the financial areas that matter the most to you.
Beware of advisors promising unrealistic returns. Choose those who instead focus on planning, responsiveness, and proactivity. The idea is that a successful advisor should adapt to changing market conditions and value strategic planning over grand promises.
Finally, steer clear of advisors that don’t have a solid investment philosophy. The right advisor should outline their financial methodologies. This means their approach to assessing risk, adjusting investment strategies according to market conditions, demonstrating a comprehensive understanding of various investment tools, and making recommendations for your specific financial goals. Above all, anticipated investment returns should be based on data-driven analysis and indicators, rather than mere speculations.
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