Financial world is complicated and for laic person difficult to understand. Therefor many of us seek out for help of a financial consultant. But how do we know that consultant provides us with quality service?
Below you can find some useful tips how to recognize a good financial consultant:
- Consultant is not a sales representative
Sales representative usually represents one company and cannot give you an objective comparison of different products. Financial consultant on the contrary, seeks various solutions for different needs of its clients and offers more products from multiple companies.
- Informs and explains
The consultant should be able to explain proposed solution and know its connection to your personal goals. He should be able to justify the choice of specific products and offer alternatives. He should not speak only about benefits of proposed products, but also highlight risks and possible drawbacks.
- Listens and then proposes solution
Financial consultant first listens. He should identify your plans and goals, financial possibilities, ongoing contracts. Financial consultant never comes to the first meeting with the offer of specific products and plans.
Financial consulting is legislatively regulated and consultants must follow a series of strict rules. Invest time to verify your consultant.
- Set emotions aside, use your head
Be realistic and don’t be very credulous. If financial consultant promises you unrealistic profit, flaunts with the guaranteed appreciation and refers to the development of the financial market during last years, be very careful in your future cooperation.
- Force and time pressure does not belong to financial consultancy
Good financial consultant is not only punctual, but also gives you enough time to think about the proposal and the decision. A good consultant does not come with “now or never” offers.
- Details are important, be critical
Be active, strict and ask questions. Feel free to book an appointment with consultant in his office or at a neutral location (e.g. in a quiet café). Financial consultancy has not been doing on the couch in your living room for some time.
- Is brand determining? Often, yes…
Is the financial consultant working for one of the big consulting company? Search for references, experience and independent awards.
- Learning as the basis of the good consultant
Do not hesitate to ask a financial consultant on his experience. How long has he been in business? What is his education and which courses did he complete? Remember that financial products are rapidly changing and only consultant who is “in the picture” can give you a good advice.
- You CAN say no!
Nobody can force you into the contract signature. If you have doubts, find out more information, ask someone knowledgeable of your surroundings, take time to decide. If you have any concerns, you can always say no.
How to recognize a bad financial consultant?
- Financial consultant strives to contract signature on one of the first meetings, puts time pressure
- Consultant does not give you advice, but instructs you what to do
- Consultant hides risks and presents only product benefits
- Formulations like “it’s too complicated for explanation” or “you don’t need to understand this” should warn you