I want find a good financial advisor, what is my first step?
Question:
Answer:
Step 1. Educate yourself: read Jeremy Siegel, Peter Lynch, and Benjamin Graham.
Step 2. Learn how financial advisors earn their money. There are many different systems, but advisors who charge a fee rather than earn commissions tend to find themselves more in tune with the clients' best interests.
Step 3. Now that you know what you're looking for, ask some financial advisors to discuss two things: their fee structure and their investment philosophy. You also might want to discuss any specific needs you will have and specific goals that you've set, and ask the advisor if they can work with your specific requests. Many advisors today only provide a kind of 'one-size-fits-all' approach to clients, so if you can find one who still provides specialized services to each individual, so much the better. Most importantly, you want an advisor who is trustworthy. If a little voice is telling you that there's something wrong with this person, don't hesitate to walk away. There are other advisors out there. Find one that you're comfortable with.
Step 4. Check them out. Verify with the state authority or the SEC that they do not have any pending legal issues or past indiscretions.
Best of luck to you.
First, read and study Investments for Dummies or similar titled book. This will give you the basic knowledge to find the right financial advisor for you. Financial advisors have different philosophy on investing your money. Know a little before you hire an advisor. Ask them about complaints filed against them or their firm.
The previous comment on self-education is wise.
But by doing so, you probably then know more than most financial advisors.
If you really want a financial advisor, I would find someone who has made lots of money (not by winning it) and ask them to mentor you.
If you deadset on paying a professional advisor, make your first question, "May I please see your personal financial plan?" If they refuse, or if it is crap, don't use them. A good financial advisor will have done a good job on their own plan and would be willing to show it to you.
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