Tips For Choosing a Financial Advisor | Financial

A good financial advisor puts the client’s interest first – understand their need, have an intelligent understanding of their situation, and works hard to achieve what they hope to gain financially in a given time period. He or she must be honest, trustworthy and demonstrates a sense of ownership to the client’s business and their finances, as if losses that may be incurred would be a personal loss to them as well. With these values intact in your financial planner, you can rest assured that your net worth is well taken cared of.There are four major areas by which to gauge how qualified and competent financial advisors are:1. Credentials – The eligibility of a financial planning professional in the United States is reviewed and affirmed by the Certified Financial Planner (CFP) Board of Standards Inc. The certification the board issues is the recognized standard of excellence for financial planners. This certification ensures that the financial planner met the CFP Board’s requirements in terms if education and experience, and that they adhere and abide by the CFP Code of Ethics. Do your background checking and online searches, beginning with the Financial Planning Association (FPA) database at fpanet.org.2. Experience – Look for a financial planner with at least four years experience in the field of professional financial advisory. This length of service and exposure in the financial industry should be enough for your financial planning professional to know how the industry works, established his or her network of contacts and became well-versed in putting the client interest first. Casually check the financial planner’s expertise and knowledge in areas where he or she services financial planning: portfolio structuring (individual clients), taxation (small to medium businesses), benefits package (large businesses and corporations) and other related financial issues as it relates to your situation. If possible, get a financial advisor who has successfully worked on a client with a profile or need that is similar to yours.3. Compensation – Some investments and finance experts view the source or bulk of the financial advisor’s income as the determinant on where his or her loyalty and focus lies. As such, it is wise to hire fee-only financial advisors, who do not receive commissions from investments and financial products their clients purchase. While it is not entirely prohibited to sell or have interest in the purchase of some properties or assets, an individual who services financial planning needs of another person and have direct access on how to fulfill those needs need (read: doubles as a sales agent) may have a questionable credibility when it comes to providing you with realistic investment options.4. Character – Many financial handbooks forget to include character as an important factor in determining the competence and success of a financial advisor, yet this could prove to be the most important gauge of all. Observe the individual’s corporate and personal values. Does he or she listen to you when you lay down your financial concerns, including the drama that goes with it, if any? Does he or she seem impatient, cuts you off and appears as a smart-Aleck? Ditch the guy or gal right away to prevent you from future problems. On the other hand, if the financial planner is accommodating, listens well, empathize and sympathize, you may have a gem of a financial planning professional.