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Choosing a Financial Advisor

This is a bit like getting married – if you are lucky you will stay together for years, if not...


So, you need an advisor – sometimes in the same way that you need a dentist – because something hurts, worries or irritates you. One approach is to tie a piece of string around both tooth and door handle – but you may decide the DIY approach is not for you.   


To help there follows a ten-minute guide to choosing your perfect financial partner:


What sort of advisor?

There are lots of advisors, tending to be either generalist or specialist. Have an idea what you want in advance. In medical terms if you are not sure what is wrong with you, you go to a General Practitioner, if you know what is wrong you go to a consultant – a specialist. It should be apparent from their website if the firm you choose are generalist or specialist. There is also the choice between independent or tied advisors. For more detail click here.

What do they cost?

This often comes top of the list and it is understandable since you are buying a promise of expertise and future service – which is all well and good but not tangible in the same way as (for example) is buying a car – which you can try out first. Most firms will have a section on their websites which give you an idea. For an example click here

Are they any good?

Most advisors will tell you they are brilliant but then to paraphrase Mandy Rice-Davies ‘they would say that, wouldn’t they?’ So how can you tell if the advisor knows what they are doing?  


Qualifications: Have they taken just the minimum required or extra advanced examinations in their specialist subject?  This does not of course guarantee that they aren’t academic idiots however it does demonstrate commitment beyond the minimum level of required study. For more detail click here.


Experience: I personally would not want to give a newly qualified surgeon a chance to make a name for himself. Five plus years of actually learning how to do stuff would for me be a prerequisite. Let the new ones practice on someone else.


Recommendation: This is a good route to the correct advisor. Non-professionals may not be able to evaluate the comparative ability of their own advisors but at least they can tell you if they listen to them, can empathise with them and turn up on time for meetings. Professionals such as accountants may be able to point you the right way.


Testimonials: This is what I use when buying stuff on Amazon. The problem with some firms is that the testimonials are all from members of their own family…


Size of firm: Big firms tend to project a feeling of security and have lots of advisors but do ask whether you will be passed from advisor to advisor following leavers, promotion or the like as this can be disruptive. Smaller firms tend to have more staff consistency and are often specialist.


Who will manage my money?

Some advisors build bespoke solutions for clients whilst others farm out the management of client monies to third parties to manage. There are advantages and disadvantages to both and you should ask which applies. 


What happens next?

After you have gone through the above stuff I would suggest sending an email to the firm asking for an appointment to have a chat. You may not wish to invite them straight into your lounge (having experienced double glazing salesmen in the past) but a 15-minute chat on the phone will tell you whether they seem any good and are listening to you. Any pushy stuff and I suggest you back off. Ignore regional accents (I am a Brummie) – just make sure you are communicating. You are potentially entering into a long-term relationship – take it slowly.


If you decide to take this further, the advisor will sit down with you and find out whether you and they are suited. If you are a match they will outline a plan to you and tell you what it will cost.  For more information on the typical process click here.


Good luck.


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