Selecting a Financial Consultant - Debunking the Myth

In your efforts to manage your cash and arrange for financial security, are you currently sometimes persuaded to get a product or engage a consultant's services based on claims such as for example:

"It is the best financial product in the whole industry."
"We are the best financial services company."
"I am the best Financial Consultant available."

Such statements are not uncommon in the financial services industry, just how do you decide who to trust or which financial institution to place your business with? You may be grappling with this particular issue when you graduate and begin planning your finances or simply nonetheless as you take stock of your retirement pans.

Why don't we look at these common statements to have a clearer picture of what's truth or myth:

1. "HERE IS THE BEST FINANCIAL PRODUCT AVAILABLE IN THE MARKET"

There is absolutely no one-size-fits-all product available in the market. What is ideal for one person may be unsuitable for another. A specialist Financial Consultant should gather information about your financial needs and status prior to making any recommendation. You'll expect your physician to prescribe medication only after he has made a diagnosis, so have exactly the same expectations of one's financial consultant.

Ask your consultant: "On what basis is this recommendation ideal for me?"

2. "THE MORE AWARDS THE HIGHER"

Awards do give an indication on a Financial Consultant's performance. However, do keep in mind that awards are mainly measured by sales performance. In the same way an easy food chain that sells the most burgers might not have the best cooks, a Financial Consultant who has achieved a higher sales performance may not necessarily be the most suitable person for you.

Ask your consultant: "How did you qualify for the awards?"

3. "WE ARE THE BEST FINANCIAL SERVICES COMPANY"

Reputation and branding matter but the key question is how much emphasis you should place on them. Different financial services companies claim to be the best, so which is actually the best? Well, they might all be the best and that depends on the basis of your measurement, for example, new business sales or assets under management. Just like  https://squareblogs.net/shrimpwhale2/why-independent-financial-advice-is-vital-for-inheritance-planning-1czx  that has the most number of patients does not mean the doctor that you will be seeing is the better.

Ask your consultant: "Best in what area?"

4. "WE CAN SOURCE FOR YOU THE VERY BEST PRODUCT FROM DIFFERENT COMPANIES"

That would be possible only if a Financial Consultant can have access to all financial loans from all finance institutions and the financial products can be easily compared to one another. Unfortunately, just like  The Card Association  of perfect competition in Economics, this may prove elusive in real life. Major financial services companies still use their own pool of Financial Consultants because the only distribution channel for most of their products. Furthermore, competing financial products usually have different benefits and drawbacks. Make sure the financial product recommended is the foremost suited for you rather than the one that is best for the Financial Consultant with regards to remuneration.

Ask your consultant: "How are you remunerated for the different options listed in your recommendations?"

When you come across these statements, ensure you ask the consultant to back them up. A good financial consultant will let you make investment decisions that are appropriate for your preferences, and these change according to what stage of your life you are at.