Choosing a financial advisor can be a tricky considering and there are some due diligence that should be addressed before selecting. The first and foremost thing is ‘Honesy & Integrity’ these are the values that is a must in a financial advisor. More than domain expertise we would say. It is easier for an expert to sell you the wrong product which can result in unforeseen problems in the future.
The very first thing you should ask is why do you need a financial advisor, you should be able to clearly lay down the frame work of what you expect from the financial advisor. The problem here is many of us are not aware of our own financial health and have not taken the trouble to make ourselves financially literate.
Lets begin with what you should not be looking for whenever a financial advisor says any of the below mentioned words, phrases or use them in sentences – Some of these are taken from the book “The Intelligent Investor” by Benjamin Graham who was the mentor of Warren Buffet – here it goes!
- The opportunity of a lifetime
- This baby is gonna move guaranteed!
- You need to hurry its a sure thing
- The smart money is buying it
- Its a no brainer
- You cant afford to miss it
- You will be sorry if you dont invest now
- Dont you want to become rich?
- There is only upside, no downside
- Break your Fixed Deposit and invest here
- I am putting my mother in it – Trust me
and the best of them all ” No one else knows how to do this”
Now lets look at a few things that a good financial advisor will tell you
- Investment in a strategy of calculated risk depending upon your risk appetite and investment objective
- Keep realistic returns percentage in mind
- Stock market is not a get quick rich way of investment
- The returns from stock market is non-linear
- Invest for the long terms
- Believe in the power of compounding interest
- Have clear set of financial objective in mind
- Dont be bothered by market fluctuations
- Invest wisely
- Have an balanced asset class portfolio
