In your efforts to manage your money and plan for financial security, do you sometimes agree to buy a product based on a claim or engage in the services of a consultant such as:
"It's the best financial product in the whole industry."
"We are the best financial services company."
"I am the best financial consultant in the business."
Such statements are not uncommon in the financial services industry, so how do you decide who to trust or with which financial institution to run your business? You may have this problem when you graduate and start planning your finances, or maybe now that you have a stake in the retirement fund.
Let's look at these joint statements to get a clearer picture of what is factual or fiction.
1. "This is the best financial product in the market."
Fits the same size in the market. What is suitable for one person may not be ideal for another. A professional financial consultant should gather information about your financial needs and status before making a recommendation. You would expect your doctor to prescribe a prescription, and they would expect the same from your financial advisor.
Ask your counselor: "On what basis is this recommendation appropriate for me?"
2. "More information about the better."
The awards indicate the performance of the financial consultant. However, keep in mind that prizes are primarily measured by sales performance. Just as a fast-food chain that sells the most burgers may not have the best chefs, so a financial advisor who has a high sales performance may not be the right person for you.
Ask your advisor: "How did you qualify for the awards?"
3. "We are the best financial services company."
It's a matter of reputation and branding, but the critical question is how much emphasis you put on them. Different financial services agencies claim to be the best, so which one is the best? They can all be better, and it depends on your measurements, such as new business sales or assets under the business. Like a hospital with many patients does not mean that the doctor you are seeing is the best.
Ask your advisor: "Which area is best?"
"We can get the best product source for you from different companies."
This will be possible only when a financial consultant has access to all financial products from all financial institutions, and financial products can be easily compared with each other. Unfortunately, just like the theory of perfect competition in economics, it can also be found in the real world. Large financial services companies still use their pool of financial consultants only as a distribution channel for many of their products. In addition, competing financial products usually have different pros and cons. Ensure the recommended financial product is the best fit for you and not the best financial consultant in terms of compensation.
Ask your advisor: "How are you for the various options listed in your recommendations?"
When you see these statements, make sure you ask your advisor to back them up. A good financial advisor will help you make investment decisions tailored to your needs and vary depending on what step of your life you are at.
Benjamin Ang holds Associate Financial Consultant (AFC) and Associate State Planning Practitioner (AEPP). He writes to share financial information with the public about wealth matters and writes regularly about all the beautiful things life offers to survive and experience.
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