Most people go through their lives looking for experts to help their solve problems within their daily lives. Experts can come in many forms, plumbers, attorneys, chefs, and mechanics.
At some point in their lives, most people realize they're going to need help solving a financial concern.That is where a personal financial expert can be helpful.
The question is how find the right personal financial expert to fit your needs? Well here are three tips when looking for a personal financial expert.
The first question to ask yourself when evaluating a financial advisor is: How do they get paid? How your advisor gets paid is probably the single most important factor when selecting your financial advisor. Unfortunately, in life there is no such thing as a free lunch (or in this case free advice). Your financial advisor can get paid in multiple ways. So if you're going to see a financial advisor, it is important to understand if that person gets paid a fee for managing your money, or paid a commission for selling you a product, or paid through an hourly charge you or a consultation. How your financial advisor is getting paid is important to understand when selecting a new financial expert. So my recommendation is the next time you have an appointment with your financial expert, ask him or her “How am I paying you?” and “How much have you charged me for your expertise?”
The second question is: What are his or her professional qualifications? In the financial services industry, the main one most people seek out, and I think has the highest respect in the industry is a Certified Financial Planner (CFP) designation. But there are others as well. Within the insurance industry, the charter life underwriter (CFW) and charter financial Consultant (CFC) designation is important. In addition, accountants have designations that they use when they manage money for a fees. It is important to ask for those certifications from your financial expert. It indicates that your expert has gone the extra step to improve their knowledge to help you as best as he or she possibly can.
The third thing that I would look at hen determining a financial advisor is personality fit. The reason why is pretty simple -- you obviously need to feel comfortable communicating with this person, they need to understand your needs and desires. But this is number three because too often times when involving big money decisions people don't want to feel uncomfortable , and they let their emotions take control and lead them into a road where they probably wouldn't be as successful financially if they sat back and looked at things logically
So anyway, that's the wrap-up on looking for a qualified expert is how they get paid, what are their certifications, and then finally is there a personality fit.