If you’re considering relocating to the Carolinas or have already done so, you may consider changing your wealth management team. Finding a financial advisor in the Carolinas should be straightforward, right? A quick Google search of "Find a fiduciary financial advisor in the Carolinas" should provide hundreds of choices in less than two seconds. Sounds easy, right?
Your selection decision should be considered one of the most important decisions when pursuing or maintaining financial independence. This guide is intended to provide an overview of how to identify a trustworthy financial professional to manage your wealth and serve as your financial advocate.
We’ll touch on the following four important topics:
- The Importance of Working with a CERTIFIED FINANCIAL PLANNER™ (CFP®)
- Understanding How Financial Advisors Are Compensated
- Recognizing Red Flags When Selecting an Advisor
- Why Select an Independent Financial Advisor?
Read our popular Quick Guide: “Comprehensive Financial Planning in the Carolinas.”
The Importance of Working with a CERTIFIED FINANCIAL PLANNER™ (CFP®)
The relocation to the Carolinas signifies a geographical shift and demands a thorough review and possibly revamping of your financial strategies. Collaborating with a fiduciary CERTIFIED FINANCIAL PLANNER™ (CFP®) can give you more confidence that your wealth is managed with the diligence, expertise, and personalized attention it deserves.
A CFP® is a financial planning professional with a recognized certification that denotes competence, ethics, and adherence to professional standards. This level of credibility can be critical when dealing with complex financial planning topics. The rigorous training and examination process that CFPs® undergo equips them with the necessary knowledge to navigate the complex world of finance. They can offer strategies that support your financial situation and help you pursue your retirement goals more seamlessly.
Ideally, you want a CFP® in Greenville, SC, who will be your financial advocate. This professional’s advice is always in your best interests while ensuring investment strategies align with your unique goals and lifestyle needs.
Beyond a fiduciary commitment, the key to effective wealth management is consistent, transparent communication. Open, honest communication is a pillar of the Global View Investment Advisors team in Greenville, SC., so you are always fully informed about the investment of your assets.
Understanding How Financial Advisors Are Compensated
Understanding how your financial advisor is compensated is another important component of your search process. Why? Transparency in how your financial advisor is compensated is key to a successful partnership. One way to measure transparency is their willingness to provide this type of information. How much are they paid, and who pays them?
There are three common forms of financial advisor compensation models:
- Fee-only
- Commission-based
- Fee-based models
Fee-only advisors earn their income solely from clients, typically as a percentage of assets under management. This aligns their interests with yours, fostering a mutual foundation of trust.
On the other hand, commission-based advisors receive commissions from third parties for selling their financial products. There is always the potential for conflicts of interest with this arrangement. For example, the advisors sell the products with the biggest commissions even though other products produce better results.
Fee-based advisors combine the two, charging fees or commissions based on the size of accounts or other criteria.
Understanding their compensation methods enables you to select the wealth management team that is compensated for results and not their sales skills. Your choice should hinge on which compensation model aligns best with your financial goals and comfort level. It's important to discuss this upfront to avoid future surprises.
Recognizing Red Flags When Selecting an Advisor
While we always want to believe that people have our best interests at heart, financial advisors must make a living. The Catch-22 is they want to make a living from your hard-earned assets.
The following are three red flags to watch out for when your screen and select financial advisors:
- Lack of Transparency: A reputable financial advisor should be open about their compensation, services, and approach to managing your investments. For example, they should clearly explain how much they are compensated, who compensates them, and what you receive for the compensation. Ask advisors to document this information so you have a written record in case of a dispute.
- Makes Guarantees: These are potential red flags if an advisor guarantees certain investment returns or pushes high-risk investments without a clear understanding of your risk tolerance and financial goals. An experienced financial advisor should spend time getting to know your financial situation and goals and should be responsive and clear in their communications with you.
- Disclosure Items: A disclosure on an advisor's Financial Industry Regulatory Authority (FINRA) or Securities and Exchange Commission (SEC) records could be a red flag for you. A disclosure could indicate a history of professional misconduct or legal issues that could reflect on the advisor's integrity, ethics, or competence. Hence, it’s important to discuss with the advisor in question so you have their history of compliance with industry regulations.
Why Hire an Independent Financial Advisor?
Working with an independent financial advisor can offer several potential benefits. For example, because they do not work for a large corporation, they are not required to push certain products that produce the most revenue for the corporation.
Independence means that financial advisors can choose the clients they want to work with, the services they want to offer, how they are compensated, and the services they provide.
Independent advisors also have more freedom to provide custom services and best-in-class solutions that fit the needs of their clients. Why is freedom important? They are not limited to proprietary products and services produced by corporate owners.
Independent financial advisors who are fiduciaries can work for their clients, not corporations that own their firms.
Remember, expertise can vary significantly among independent advisors, just as with any other profession. Therefore, it's crucial to research and interview several advisors before choosing one to work with. You should ensure any financial advisor, independent or not, is a trustworthy financial expert with your best interests as their top priority.
We try to put ourselves into your situation at Global View Investment Advisors. Our decision to create Global View was driven by the understanding that investors need an independent champion who is a fiduciary and compensated with fees. Our advice only carries weight when it's grounded in advocating for your needs. That's when it becomes genuine.
We strive to offer you this kind of authentic guidance, steering you clear of frequent pitfalls to assist you in pursuing your financial goals. To get to know us better, please click here.
