Choosing the right financial advisor
(NC) With RRSP season well underway, many Canadians are wondering whether it's time to seek financial advice. Here are some tips to help you choose an advisor that's right for you.
Since you will be relying on your advisor for information and guidance, it is important that you pick someone you find trustworthy, who helps you think about your life goals, who understands your investment needs, and who fully answers all of your questions.
Your advisor will help you create a plan that's right for you, review it with you regularly and remind you to stick with your plan so that your money can continue to grow. Studies have shown that people who have a financial advisor for 15 years or more, have more than double the savings of those who do not have advisors – mostly because simply having an advisor encourages people to save regularly and save more.
It is important to make sure that the individual is licensed. Licensed advisors are overseen by regulators and must complete education programs before and after they are registered to help them keep on top of new financial products, rules and regulations, and industry trends. Check regulators' websites to determine whether the individual has been the subject of any complaints or investigations.
There are rules requiring financial advisors to tell clients the range of products that they are licensed to offer, their qualifications, and how they are paid. Some financial advisors are paid by salary or through commissions, some through a separate fee paid directly by the client, and others might offer a choice of payment methods. Be sure that you understand the costs of your investments and the services your advisor offers.
Finally, the key to a good relationship with your financial advisor is good communication, so ask questions and update your advisor on any changes in your circumstances.
For more information, visit www.ific.ca/en/pg/investor-centre/ or your provincial securities regulator.
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