| u think you need an Investment Advisor? Hold on | | | | How Do You Find The Advisor for You? |
| before you answer because this is sort of a trick | | | | Since there are good Investment Advisors and |
| question. Also, I am definitely biased because I am | | | | bad ones, how do you find the former and avoid |
| an Investment Advisor. Nonetheless, I think I can | | | | the latter? Good question, and there are some |
| assist you in looking at this issue in a way that will | | | | keys. Most large brokerage firms list the |
| serve you. | | | | Investment Advisors they work with and maintain |
| Working with a fair number of investors over the | | | | information about their past performance. This is |
| last nearly 20 years, I have observed that while | | | | not a foolproof resource, though, since they tend |
| most are intelligent people, and many are fairly | | | | to recommend the Investment Advisors who |
| knowledgeable about the market, they are, as a | | | | invest in their products or clear their business with |
| group, not terribly successful with their investing. | | | | the firm. So if you pursue this avenue, you need |
| Why should they be? More likely than not they | | | | to watch for conflict of interest issues. |
| have made their living doing something other than | | | | You can always subscribe to one of the |
| investing, so why would they think they can do | | | | numerous database services that include |
| what a professional does better than a | | | | information, and sometimes rankings, on |
| professional? (After all, they go to professionals | | | | Investment Advisors. These services tend to be |
| for health care or for car repairs when needed!) | | | | fairly pricey, though, so they may not be your |
| Most investors—even some | | | | best choice. Another option is to find articles (yes, |
| professionals—tend to be "off" in their | | | | like this one) or free newsletters written by |
| timing: they buy things when they are hot, not | | | | Investment Advisors. If you find one or several |
| when they are cold. But for the greatest benefit, | | | | that make sense to you, check out the IA and |
| it should be the opposite. The media doesn't help | | | | see if there's chemistry between you. |
| much when it comes to this buying approach, and | | | | When checking out advisors, here are some |
| let's face it; greed and fear play a large part in | | | | things to keep in mind: |
| most peoples' investment decisions. | | | | 1. Verify their record -- look over their past |
| I truly believe the majority of people would be | | | | performance; |
| better of (that is, they would end up with more | | | | 2. Consider their system. Will it work in different |
| money at the end of the day) if they used | | | | market environments?; |
| professional money managers to advise them on | | | | 3. As best you can, check out their operation and |
| their investing. Specifically I am referring to | | | | 4. See if they've had regulatory problems. |
| Registered Investment Advisors with proven | | | | 5. Equally important as doing your due diligence is |
| track records of performance in investing in | | | | making sure there is good communication |
| stocks, bonds, mutual funds | | | | between you and your advisor and that you trust |
| Let me burst one myth right off the bat: You | | | | this person with your money choices. |
| don't have to be a millionaire to engage the | | | | Another quick free way to scan through a select |
| services of a topnotch advisor. Some people think | | | | database and find a wide variety of candidates is |
| you need to start an account with $50,000 or | | | | with I’m registered there myself as an |
| more to get a really good advisor. Well, you may | | | | advisor and know that the company did a |
| have more choices if you're at that level, | | | | background check regarding registrations and |
| however you can find very successful | | | | regulatory issues. |
| Investment Advisors who will accept opening | | | | An important question to ask is the how the |
| accounts for as little as $5000. | | | | advisor gets compensated. You want to stay |
| There are literally thousands of Registered | | | | away from commission junkies or salesmen |
| Investment Advisors in the US. Just what do they | | | | disguised as advisors. I believe that you will get |
| do—what service do they provide you? | | | | the best unbiased advice from someone who is |
| They do the legwork; the research and analysis. | | | | paid a management fee based on the value of |
| Maybe more importantly, they keep their primary | | | | the assets that you entrust them with. |
| focus on the markets, and specifically on their | | | | To take it one step further, ask if the advisor |
| specialty area like individual stocks, mutual funds, | | | | invests his own money in the same methodology |
| or bonds. | | | | that he recommends for his clients. If he |
| Because they spend the bulk of their time and | | | | doesn’t, ask why. If you don’t like |
| energy researching, considering, and analyzing, | | | | the answer, close your check book and run as |
| they naturally have a greater sense of the | | | | fast as you can. |
| market and its movements than those of us who | | | | Choosing an Investment Advisor can yield |
| don't put this kind of attention into it. So, with the | | | | long-term high profit benefits. I encourage you to |
| right advisor, you can keep your focus on what | | | | consider it if you haven't before. However, as |
| you want—like your business or your | | | | with any relationship, make sure there's a fit |
| retirement or whatever—and still get the | | | | before you jump into it. |
| information you want and need to invest wisely. | | | | |