Finance is to our lives what the backbone is to the human body. If it gets injured, it becomes challenging to stand on our own ever again. Money matters like buying and selling stocks, investing through mutual funds, and planning your retirement involve dealing with complex numbers. 

Take the case of equity investments. You might not know which stocks you should choose to expect good returns from your investment. Managing your investment plan all on your own can make your head spin, especially as per the recent changes in the Union Budget 2020-2021. It is where an experienced financial advisor can help you a lot. He can assist you in planning the finances to ensure you achieve various goals at different stages of your life. 

Every individual does not need a financial advisor. However, if you are keen on investing money in different financial instruments, a professional advisor by your side is the key to safeguarding your investment against market risks. 

When Do You Need a Financial Advisor?

There comes a certain age or a point in career when hiring a financial advisor becomes apparent, which is not entirely right. Youngsters who are not finance-savvy might find it difficult to strike a balance between saving and investing money in the right way. Financial planning is not about depositing your paycheck in your bank account and withdraw money when you need it. Rather, it is about evaluating your current income and making strategies to fulfill your goals in the future. 

You may also need a financial advisor while going through a significant transition in life, be it starting a family, receiving any inheritance money, or having kids. A financial advisor will examine your financial health holistically and help you devise a plan appropriate to match your goals. Experienced advisors will also have the expertise to help you create wealth using the right investment strategies. 

For instance, if you plan to retire from work at the age of 60 and have a corpus of Rs. 10 crores, a financial advisor will select the right financial assets to fit into this goal. Alongside, they will help you in safeguarding your assets as you near retirement. 

How to Choose the Right Financial Advisor?

There are thousands of advisory firms or even more in India and choosing one among those can be overwhelming. The right way to do so is to break the process into crucial steps that help in narrowing down to the right choice.

1. Start with Selecting the Right Type of Advisor

There are two basic types of financial advisors – asset managers and wealth managers. The right selection here should be based on the specific help you need. 

If you are worried about making the right investment decisions related to stocks, mutual funds and other avenues, you need an asset manager. He will help you build your investment portfolio to maximize gains and achieve several financial goals. On the other hand, you need a wealth manager to take care of your overall financial health in terms of tax planning, long-term investment planning, along with building your portfolio.

2. Check Credentials and Experience

The right certification and experience of a financial advisor matter when selecting one to manage your finances. Check their relevant licenses and certifications. Find out for how long they have been offering financial advisory services, who their clients are and how well have they performed in the past. 

3. Ask About Their Service Fee Explicitly

Most financial advisors charge a fee based on the assets they manage. Still, it will help if you ask about the total service fee involved in handling your finances beforehand. Also, make sure you select a reputable team of financial advisors, like FinEdge, which has credible experience to deal with several facets of financial planning.


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