7 Financial Advisor Warning Signs by pfinancecr


             Warning Signs
 7 Financial Advisor Warning Signs

 Do you count on financial advisors to guide you with wise advice for your personal
 money matters? Giving that sort of control to someone can understandably be scary.

 To feel more confident in your decision, you'll want to know that your advisor is
 qualified and working in your best interests. While recognizing these issues with
 complete certainty may be challenging, there are some red flags that you should watch
 for. If research into your advisor uncovers one of these warning signs, it might be
 time to find someone else, or at least to start asking tougher questions.

 Here are some of the key warning signs:

    1. Absence of credentials.Everyone wants to believe that their financial expert is
       proficient and experienced. One sign that this may not be the case is an absence
       of professional certifications, such as CFP, CFA, CPA or ChFC designation.

            Take the time to learn more about these designations and exactly what your
            advisor had to do to earn them.

            If you only want tax advice, a certified public accountant (CPA) might be
            the best way to proceed. For investment advice, a Chartered Financial
            Analyst (CFA) is most likely a better choice. If you need a complete
            financial plan, a CFA, certified financial planner (CFP), or chartered
            financial consultant (ChFC) will probably be best.

    2. Lack of Time.If your financial advisor can't make the time to have a minimum of
       one thorough meeting each year, you may have a serious challenge. When it
       comes to getting financial advice, you and your goals are all that matters.

            Things can change over time; a financial advisor must be updated if he’s

       going to be effective. If your advisor doesn't have time to meet, does he
       really have enough time to do all the other things he should be doing?

3. Poor Communication Skills. If your financial advisor really knows her stuff, she
   should be able to explain financial concepts and strategies with relative ease. If
   you can't understand her explanation, perhaps she just doesn't understand well
   enough to explain the concepts to you.

4. Over-Promising.Promises of significant returns should raise a red flag. An
   advisor can talk about possible returns provided they don't make any
   guarantees. While confidence is great, honesty is even better. Big promises can
   mean a potential scam or that a financial advisor that is less than honest.

5. A lack of real transparency.Your advisor should always be forthcoming about
   the types of investments and the fees and commissions involved. People in
   these professions can earn significant commissions if they push certain
   products. Are those products in your best interest?

       Request to see all the fees that you're being charged for any applicable
       transactions, and ask about the commissions. Ethically, advisors should do
       what's in the client's best interest.

6. Excessive selling. If your advisor is attempting to sell you on a complicated
   option deal that you're struggling to understand, is it really right for you?

       The financial plan an advisor follows should be tailored to your goals and
       your level of comfort. Don't allow your advisor to push you into something
       that's not right for you. If he's following the plan he laid out for you from
       the beginning, he shouldn't have to talk you into much.

7. Disorganized.A lot of record keeping goes along with being a financial advisor.
   If your advisor isn't organized, then he should be able to hire someone that is.
   This is your money we're talking about.

                                        You need those records for the IRS, at a minimum!

                                   None of these warning signs is necessarily a deal breaker, but they are definitely things
                                   to watch out for. Most importantly, be sure you feel confident and comfortable with
                                   your advisor. Remember that we're talking about your money here, so keep your eye
                                   on it!


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Curtis Rose is an experienced professional with extensive experience in all
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