It's no small matter entrusting someone to manage your investments. Scrutinize the person almost as much as someone you marry. There are several considerations, but how you pay the adviser is critical.
It is critical for any investor to fully understand the difference between a broker and an investment advisor: investors need to understand whether the advice is objective or, perhaps, driven by financial incentives.
Investors shouldn't be obsessed with their portfolio's performance, but an annual evaluation is key to keeping you on track.
When you visit a pediatrician, you know she graduated from medical school and completed additional specialized training. When you do business with a lawyer, you know he has a law degree. When you send your child to school, you are certain the teacher is state-certified and meets state-mandated continuing education requirements.
You’re 10 years or less away from retirement. You can clearly see the next phase of your life down the road and it’s coming up fast. Are you ready for it? Do you have a comprehensive plan in place so you don’t outlive your savings?
…….if you haven't asked your financial advisor how they are being compensated, now is the time to ask……
Remember that a person selling a product can never be a true advisor, as their interest lies in selling their product and meeting their targets. So, who should someone seeking advice turn to? The best bet for the investor would be a fee-only advisor, who only offers advice, just like a doctor/lawyer and does not sell products or get any remuneration from it. In such a case, the advisor would work in their best interest, offers the most appropriate solution and charges a fee for it.
………"Investors must insist their advisors put in writing they will do certain things that the best advisors today already do," said Knut Rostad, executive director of the Institute. "The Investor Bill of Rights will help them."
