7 Critical Things Your Financial Advisor Must Meet

7 Critical Things Your Financial Advisor Must Meet


Entrusting your wealth to a company or an individual to grow takes a lot of trust with a healthy sprinkling of faith.

Here are seven things your financial advisor needs to be in order for your investment to be safe.

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1. Be Regulated in RSA

Your financial advisor needs to be regulated in the country that you reside in.

Why is this important?

It makes them accountable and ensures that they are giving sound advice. Plus, if you wish to complain, you have the protection of that regulatory body – in South Africa, the FSB – to go to.

2. Be Independent

Why is this important?

Being with an independent financial advisor means that there is little possibility of biased advice being offered and a stronger likelihood of only sound, impartial advice being considered for your investments.

Some companies have conflict of interest due to key members of their staff being affiliated with other companies. Can they truly give impartial advice? If there is a conflict of interest, has it been disclosed?

3. Be Committed

A good way to assess if your financial advisor or company is committed to the country they are established in is the evidence of a bricks-and-mortar office. Can they meet you face to face? If not, that should be enough to set your alarm bells ringing.

Why is this important?

No commitment to the country means that, should they suddenly change strategy and decide that South Africa is not for them, there’s nothing stopping them from leaving.

Even if they are regulated in South Africa, they may still close their doors. Where does that leave you and your wealth management?

4. Offer Quality of Providers

It is important that your financial advisor offers you products and businesses from large international companies with a long-standing history.

5. Offer Quality Investment Options

Your financial advisor or wealth-management company should be offering you quality investment offerings. Do they have a wide range of investment options, and how competitive are they in the market place?

Why is this important?

Knowing how your investment company compares with other companies might be a bit of an eye opener.

Your financial advisor might be getting away with overcharging simply because you are unaware of what they should be charging. For example, some charge their clients an upfront fee to get entrance to investments. This fee is completely unnecessary and literally goes straight into their pockets.

If your financial advisor charges you an entrance fee to gain access to investments, it might be time to move.

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6. Keep You Up to Date

With so many changes in legislation, overseas changes and current trends, it is vital your financial advisor provides you with on-going education on these changes.

Why is this important?

If they are not telling you, the worry is that they do not know themselves. More than that, if they know and are not advising you accordingly, it could mean your investments are at risk.

7. Be a Decent Human Being

This may seem like a soft point in a financial piece, but when you are dealing with someone on a regular basis, it helps a whole lot if you actually like the person. More so if you trust them.

Do they return your calls? Do they do what they say they will do? Do they explain technical things to you in a way that helps you understand them?

Why is this important?

You will be in a relationship with this person for the rest of your life. If you don’t like them now, you’re probably still not going to like them 10 years from now.

Michael heads up the Group Sales for Carrick, and is the only British member of the Board. He was born in the old Roman city of Chester, England, where he also began his career at Trinity Mirror PLC. Amongst a number of accolades he became the youngest person to manage the company’s most important clients in the Key Accounts position.