by LOUW VENTER
Part 1 – Finding a trusted adviser
Your relationship with your financial planner is critical to your financial health. Choosing a financial adviser is often difficult and establishing a relationship takes time.
There are currently over 140 000 so called “financial advisers” in South Africa, of which only approximately 6 000 have the professional designation of being a Certified Financial Planner (CFP®) and who are members of the Financial Planning Institute of South Africa. Choosing a professionally qualified financial planner to look after your financial health is as important as choosing a professionally qualified doctor to look after your physical health. A professionally qualified financial planner is easy distinguishable and has the designation “CFP®” at the end of his name.
Ask penetrating questions
You are entitled to ask penetrating questions pertaining to a financial planner’s tertiary qualifications, experience, contracts and licenses. A client should ask penetrating questions with regards to the advice given and financial products presented. A professional financial planner ought to be able to answer any direct question clearly and coherently. Fuzzy, vague answers to clear questions should be a warning to a client that the experience and/or knowledge level of an adviser is not up to standard.
Your financial health should be the main topic and focus
An experienced financial planner will always keep his focus on his client’s financial needs. It goes without saying that a thorough discussion of a client’s needs is the starting point of a professional relationship with a financial planner. Your needs ought to be understood and addressed by your financial planner in a clear and direct manner. A financial planner functions in the same way as a doctor making a diagnoses and then formulates a medical solution and prescribing medication and/or rehabilitating conduct.
Monitoring your financial plan and financial progress should be done at least annually. You are assisting your financial planner to focus on your needs if you make an appointment with him in the same way you see your dentist or doctor for a check-up.
Be a transparent client
It is easier to help a client when the client is transparent and not secretive. It is a matter of trust. One should be able to trust one’s financial planner with sensitive information as. It is very difficult to advise a client accurately when such a client is secretive. An experienced financial planner who has your best interests at heart will want to know about the details in your will, your monthly cash flow, previous marriages, children from a previous marriage, surities that you signed, elderly parents that are or will become part of your financial concerns, etc. The more your financial planner knows, the more he will be able to be of value to you.
An experienced, knowledgeable financial planner and a transparent, involved client can build a mutually beneficial relationship over time. Trust is earned and forms the basis of all relationships – choose your trusted adviser wisely!
Louw Venter CFP®
For enquiries please email: firstname.lastname@example.org
This article is a general information sheet and should not be used or relied on as legal or other professional advice. No liability can be accepted for any errors or omissions nor for any loss or damage arising from reliance upon any information herein. Always contact your legal adviser for specific and detailed advice.