If you’ve decided to meet with a financial adviser or you are offered the opportunity through your employer to receive financial advice, you must make sure that this initial meeting is as productive as possible.
The first goal that comes to many people when they meet with a financial adviser is to get more ideas on how to save money. Although these professionals can provide suggestions for better saving schemes, their knowledge can help you with many other areas, including debt management, retirement planning, investments, etc.
So if you have an opportunity to meet with a professional financial adviser, make sure you prepare for the meeting and go in with a list of your concerns and questions. By doing so you make sure that you’re getting the best advice that is specific to your situation. You also will be able to ensure that the meeting stays focused on your goals rather than turning into random, shallow sales pitches of everything.
It also help to research the financial adviser’s background and credentials, try to get actual testimonials of past clients, and review this adviser’s ratings, products and affiliations to know how far you can trust the advice you will be receiving.
To prepare, think of the following points.
Your top goals
You may be looking to save, invest and plan long-term goals. But what are you most concerned about? Are you struggling with a major debt in the form of a personal loan, for example? If that is your biggest financial obstacle at the moment now, make sure that you bring it up and try to get advice on the best routes to take to minimise it — and eventually overcome it.
In addition, be aware of your own goals based on your individual preferences and priorities. This could be to channel your money into savings or investments, plan for your children’s college education or ensure a comfortable retirement. Again, when you walk into a meeting with your own goals, you will be able to pause and change topics if the discussion is navigating into an area that doesn’t interest you.
Your risk tolerance
If investments are part of your goals, you will need to be realistic about your risk tolerance. Although your financial adviser should be able to describe the level of risk with each investment portfolio, this person doesn’t know you.
It is your task to do some soul searching about your ability to handle risks and potential losses in high-risk investments. You also need to have a realistic view of what you can and cannot afford to lose. In addition, consider the time factor, if you’re planning for retirement in your twenties or thirties, you probably don’t really have to be aggressive in your investments.
If you’re at loss and unable to quantify your risk-tolerance level, talk to your financial adviser about this as well. Questionnaires in the form of quizzes may help get a score for your risk tolerance. In short, take this seriously and seek help if needed.
Life events
Discuss major life events with your financial adviser. Are you planning to start a family in the next year or two? Are marital problems brewing and you see a divorce coming up? Are you planning to relocate to another country? Being open about these major life events can help your financial adviser come up with the best solutions that fit your specific situation.
Some major life events are, of course, unpredictable, so including the likely events in your planning can help make your financial plans more realistic and adjustable when those events occur. Remember finances are the first area that gets hit by positive and negative life events, so make sure you have a plan in place.
The writer, a former Gulf News Business Features Editor, is a Seattle-based editor.
Meeting with a financial adviser
Check credentials and background
Keep the conversation focused on your goals
Know your own risk-tolerance level
Discuss any potential major life changes
— R.O.
