• Category Archives Financial Planning
  • How to Choose a Financial Advisor?

    Most people would agree that choosing a financial advisor could really be a daunting task, especially if you’re not even familiar with the factors that should be taken into consideration.


    If the choice is made correctly, expect to reap a number of benefits after quite some time. However, if done carelessly, your choice could be disastrous not only to you, but even to your family as well.

    Picking A Financial Planner Wisely

    Here are some useful tips that will help you identify, evaluate, and choose a financial planner that’s really capable of solving your financial problems and help you achieve your financial goals with ease.

    Tip #1: Decide What Type of Financial Planner You Really Need

    There are 4 basic types of financial planner and each one differs from the other.

    Registered Representatives: These are also known as investment representatives, stockbrokers, and bank representatives. Their main job is to sell investments as well as insurance products, and they’ll get a commission for doing so.

    Financial Advisors: They’re better known as IARs (Investment Advisor Representatives) and RIAs (Registered Investment Advisors). These professionals have the highest ethical standards in the financial services industries, because they’re usually compensated with fees, and they’re also considered as financial fiduciaries.

    Financial Planners: These professionals don’t need to have a license in order to execute their job. Likewise, anyone is capable of being a financial planner. So, it’s advisable to opt for one who has a CPA/PFS, ChFC or CFP certification.

    Life Insurance Agents: Life insurance is becoming a bigger part of sound financial planning. Some Edmonton life insurance agents will carry a life license as well as other licenses. While others may only carry a life license.

    Money Managers: They have the same characteristics and registrations that a financial advisor has. However, their distinguishing feature is that they’re allowed to make decisions for the investors even without the approval.

    Tip #2: Be Objective at All Times

    After being familiar with the different types of financial advisors, you can now use the process of elimination. Try to figure out which one would be really helpful to you and exclude the other three. Make sure to identify the weakness of each and focus on the qualifications too. Among other things, it’s advisable to opt for a financial advisor that specializes in retirement planning. Likewise, no matter how promising it may sound, never choose an advisor just because he has an outstanding sales skills and appealing personality. Chances are, this isn’t really the kind of advisor you need.

    Tip #3 Gather and Analyze the Data

    As much as possible, try to collect the same information from a number of professionals you’re eying on– this would make the comparison process easier and more convenient.

    Also, your data gathering should focus on these categories:

    • Ethics: Criminal record, compliance record, registration, licensing, fiduciary status;
    • Credentials: Education, experience, certifications;
    • Services: Money management, planning, investment advice, tax advice, insurance advice, legal advice;
    • Business Practices: Methods of compensation; track record, types of reports, expenses; ongoing services;

    Tip #4: Check the Internet, but Don’t Solely Rely on It

    If you’re not aware, which we doubt, you can find public information on the Internet, but it doesn’t mean that everything would be true.

    However, the good thing about this is that you can maintain your anonymity and go beyond the advisor’s own website like http://www.financialadvisoredmonton.ca to see testimonials and if the advisor has any other social proof.

    • If you already have an advisor in mind, Google his name and the firm he’s working in. Visit at least 20 of the hits you’re going to get.
    • Check the third-party contents, such as websites, newspapers, and magazine, that mention the financial planner you’re considering.
    • Keywords can help you know the advisor better. You can combine the firm and the advisor’s name together with these words: lawsuits, fraud, scams, fines, FINRA, suspensions, etc.
    • Visit the SEC and FINRA to check the advisor’s records.

    Tip #5: Meet in Person

    If you want to attain a successful interview, you should try your best and establish control from the very beginning.

    Keep in mind that advisors have the tendency of controlling the interview because it allows them to show their good side while trying to hide their flaws. Aside from that, letting the advisor take full control of the interview would mean that you’ll only hear what they want you to hear.

    So, before you meet, it’s important to prepare an agenda and stick with it all throughout. This will also help you compare the advisors, especially if you’re going to use the same questions. Written responses should also be required.

    Tip #6: Don’t Forget to Check the References

    Most advisors rely on references to verify their performance, quality, ethics, and business practices. Though, don’t rely on the references given by the advisor, because there’s only a minimal chance that they’ll be honest and show their bad side. Instead, ask their previous clients and ask them about their experience with this financial advisor.

  • Simple Financial Planning Steps

    Knowing basic financial planning steps is very important for anyone that wants or plans to be wealthy. If you do not have a plan that shows you how much you earn, your expenses as well as return on investments, it is very important that you come up with one.


    The following are some easy steps you can follow in order to come up with a solid financial plan.

    Determine Your Future Needs 

    As an individual, there are some things that you aspire to achieve in future in order to lead a better and happier life. For such needs and wishes to be fulfilled, you will need to have money. Among the needs that you will need to plan for include providing for children’s education and marriage, providing for medical emergencies, buying a dream home and creating enough financial resources that will enable you to live a wealthy life.

    Once you have identified the goals that you need to meet in future, you will need to start working out the financial road that leads to their fulfillment.

    Determine Your Present Financial Situation

    You can determine your present financial situation by making a summary of your cash flow as well as completing a statement of your net worth.

    By so doing, you will be able to get the figures that will help you analyze your present financial standing in relation to where you would like to be. The summary of cash flow enables you to know the cash inflow as well as cash outflow over a specific period of time.

    You can use it to determine the cash flow of a future project or a past time. The statement of net worth on the other hand lists all your assets as well as liabilities and then gets the difference between them.

    Put Your Finances in Order

    Putting your finances in order does not mean taking your money and then stashing it in a bank account or investing it. Instead, it is about determining the point through which money comes to you as well as how money leaves you. Among the things you will need to consider in this case include active loans, insurance premiums, retirement savings, emergency funds as well as living expenses.

    All these are expenses that are common to every earning individual, so you will need to know how much they cost you.

    Make Informed Investment Decisions

    Investing is very important for making your money grow. However, you will need to make your investment decisions carefully whether you are investing in shares, stocks, gold and so on. Before you make an investment decision, you should first understand the risk that you are signing up for.

    Do not invest all your money. Be sure to keep some for emergency reasons in a place where you will be allowed to withdraw on demand. When it comes to spending, you will need to make decisions on what is essential and what is not.

    Risk Planning

    Risk planning is a step that you should not skip in basic financial planning. The two major risks that you should not forget to get cover for are illness and death. A good insurance cover should take into account the situation of your family and also if you have any cover from your employer. The role of insurance is to take care of the financial discomfort that you may be faced with as a result of loss of income due to death of an earning member of the family especially if he or she is the primary bread winner.

    Monitor Your Financial Plan

    You will be able to achieve success in financial planning only when all financial goals are met, so it is not a process that will end soon after you make your investments.

    Instead, it is a continuous process that requires constant monitoring and evaluation to make sure that everything is going as you had planned it to. You will need to make sure that all planned contributions from your savings are generating returns towards your investments.

    There may be scenarios when you may need to do adjustments to the financial plan, for instance in a case whereby a permanent change in lifestyle over or above the estimated level has an effect on the long term financial situation.