A financial advisor can be a great asset to you when it comes to your future financial freedom. They can assist in creating a comfortable retirement for you and your spouse. Other benefits include assisting you with investment decisions, creating a lucrative savings plan, and avoiding bad debt. Personalised services include analysing your unique financial situation, and recommending products to invest in. Creating a financial strategy is also a key benefit of paying for the services of an advisor.
What happens, however, when you start feeling uncomfortable with your advisor? What are the warning signs you need to look out for with the person that manages your financial wellbeing? Here are a few red flags to look out for…
Something Doesn’t Seem Right
Trust your gut. If your financial advisor asks you to sign a blank cheque, or requests you to transfer money unexpectedly, there could be something wrong. A financial advisor should never seek the power of attorney over your money. You need full control over your money at all times. Should an advisor be trying to take that away, make sure to transfer your money as soon as possible.
They Seem To Be Pushing a Product On You
If an advisor seems to be consistently forcing a product on you that doesn’t suit your financial needs, you need to question their loyalty. Many advisors get commissions and kick-backs on products and are just trying to make a quick buck. Your best option is to examine each product that is being recommended to you. And then decide whether it is in your best interest to take it.
There Is a Lack Of Communication
If your advisor has stopped returning calls, emails, and messages, there is something amiss. An advisor needs to be completely open in order for you to make the best financial decisions. You need complete transparency. Your advisor needs to provide full communication of all the benefits, downfalls, and terms and conditions of anything that you sign for. If you feel like you are not getting the full story, perhaps it’s time to move on.
They Are Not Treating You Like An Individual
Communication is key and the advisor needs to treat you like the unique client that you are. If their services are not meeting your unique needs, it should be urgently addressed. Each client has a unique portfolio and needs specialised products for their needs. Your advisor cannot simply be pushing products in your direction. They need to take the time to fully analyse your requirements. Your portfolio needs to be a tailor-made solution, and not a generic one-size-fits-all attempt.
They Are Not a Registered Advisor
Even though this seems like an obvious point, it happens more often than you think. To protect yourself, ensure that your advisor is registered with the Financial Services Board (FSB). In order to be an accredited advisor, they will need to have met the requirements of the Financial Advisory and Intermediary Services Act. Without this, they are not qualified to give you any advice. Before you sign with anyone, request a full disclosure of fees, charges, tax implications, restrictions, and exclusions.