Ten signs that you are with the wrong financial advisor

Managing one’s finances isn’t always an easy task, and an, even more, tough job is to find the best financial planner to help you plan your investments. A lot of advice is shared on how the financial planner should have specific certifications, for example, a Certified Financial Planner (CFP), a Certified Financial Analyst (CFA), or even have some NISM certifications. However, these days, it isn’t impossible to forge any documents, and that makes it essential for any investor to be vigilant. Let us look at the ten signs that indicate you are with the wrong financial advisor.

1. No Certifications!

Irrespective of the fact that forging any kind of certification is quite possible these days, it is crucial that your financial advisor must be well qualified, i.e., must have certifications like a CFP or CFA or even NISM certifications. In addition to this, experience counts! You could always ask your financial advisor regarding the clients he/she has handled in the past and at present, the portfolios managed, etc. Furthermore, experience brings in a lot of learning, and this will be quite evident in your first meeting itself.

2. In a Rush!

Any financial advisor who is in a rush to get the documents signed by you, and doesn’t let you go through the documentation by stating that they will do the needful, then this must be treated as a red flag. It is important, that, as an investor who is handing over his/her hard-earned funds to a complete stranger, you must go through all the documents that are to be signed. 

3. Unrealistic Returns

When any financial advisor promises you returns that are too good to be true, think again before you hire him/her! The markets, as we are aware, are subject to different types of risks, and the returns can vary, based on the market scenario. If the financial advisor was capable of getting such unrealistic returns, he/she would not be catering to clients in a 9 to 5-day job! 

4. No time to listen

If your financial advisor doesn’t pay heed to your thoughts, opinions, ideas, or concerns, take it as a sign to head to a better financial planner. A good financial advisor will always be patient with their clients and consider their opinions, post which the best investment option that would cater to all your requirements would be suggested.

5. Lack of Communication

Whenever you are assigning a person to manage your investments and finances, communication is vital. A financial advisor who doesn’t understand the basics or isn’t able to explain simple concepts to you isn’t the right person to plan anyone’s investments. If your financial advisor is qualified, experienced, and knowledgeable, you will be able to understand finance and investments quite easily and in a simplified manner.

6. No response to emails or calls

Are you able to connect to your financial advisor via email, in-person, or via a phone call whenever you need to talk to them? Or is it impossible to get them online or fix a meeting with them? This isn’t a good sign! Always remember that there must be regular communication between you and your financial advisor, even in times of crisis, such as the Covid pandemic that we are facing right now! If your advisor isn’t in a position to take care of your financial worries during such a crisis, there is no guarantee that they would help you during any unexpected emergency in the future.

7. “Special Plans” for “Few Best Clients”

This is clearly a warning sign! A good financial advisor is one who treats all his clients equally and fairly, wherein there are no best or favorite clients. A few planners might come up with this concept to pressurize you into opting for a plan they specify, without considering your opinions or requirements. This is when you need to look out for another financial advisor, who will listen to you and come up with investment options that take into consideration your risk appetite, your financial goals, etc.

8. Hiding Important Information

Many times, financial advisors will pressurize you and somehow convince you into opting for an investment option that comes with a higher commission. In such a scenario, such an advisor will avoid informing you about the charges involved with the investment option. At times, certain advisors also avoid disclosing important information related to investment products, which is a sign that you must avoid handing over your investments to this individual.

9. “Free” Services

Well, yes, this could be a possibility, especially when it comes to services that are commission-based. Though the advisor might tempt you by way of offering to manage your investments or portfolios free of cost, you must always remember that in this world, nothing is free! Everything comes at a cost and in this scenario, you might end up paying commission or fees.

10. Disclosing Your Personal Information

In case you receive calls from people stating they received your contact details via your financial advisor, take it as a red flag. Even if you haven’t told your advisor not to disclose your personal information to anyone, you must remember that it is illegal to share your information with any third party without your permission.

Conclusion

Finding someone to manage your money can be easy, but finding the right person who can be entrusted with this huge responsibility, can be a tough job. While selecting a financial advisor, always remember to do a background check on that individual, their credentials, their experience, and while having a one-on-one meeting with them, make sure you stay alert and watch out for the red flags! Hope the ten signs listed above prove to be helpful to you in selecting the right financial advisor to manage your money and investments.