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Is your financial advisor worth his salt?

How to choose the right FA for your needs

Everyone knows the importance of buying insurance and having a long-term financial plan. However, the ‘how-to’ can be quite intimidating – especially if it’s your first time doing so. 

In Singapore, there are various life insurance companies. Each offers diverse coverage types, spanning life, medical, critical illness, disability, and even general insurance such as personal accident, home, car and many others. Within each type of coverage, there may also be multiple products to consider. A trusted and reputable financial adviser can help you understand the jargons and your unique insurance and financial needs. However, with so many advisors to choose from, the question is – how do you choose one that’s right for you? 

Choose a financial adviser… the same way you’d buy a car 

The fastest car on the market may not be suitable for a growing family, nor is the biggest car ideal for a DINK household. In that same vein, a “superstar” financial adviser with a long list of clients, swanky cars, and a posh office may not be what you need. 

The most important thing is whether you can see yourself driving the car for a long period of time. In other words: do you see yourself being comfortable with the financial adviser and can see yourself working with him or her for the long-term? 

For many, a relative or close acquaintance may fit this profile. However, being trustworthy alone does not mean the person has the right chops. He or she needs to also be knowledgeable about your financial situation. A new financial adviser may or may not be experienced enough for more complex financial scenarios. 

Much like you’d test drive another car before making a purchase decision, speaking to other financial advisers to gauge their proficiency and experience can help you make a better decision. 

Be prepared with questions to ask your financial adviser 

You should also prepare questions to ask your financial adviser when you meet up. No question is a silly question – there’s no shame in not understanding the different coverage types available or the jargons used!  

At the same time, if you prefer to invest on your own and purchase basic life insurance coverage, your financial adviser should be able to articulate the pros and cons and guide you in doing so. However, if you feel pressured to follow their strategy, it can be a red flag for future misunderstandings or lead to situations where you have to constantly rebuke them. If you plan to rely on them for investment advice, you should similarly want to understand their investment framework.  

Ask the hard questions 

Don’t be afraid to ask your financial adviser hard questions about themselves either. Questions such as their client base can tell you whether they are serving those with more complex financial needs. How many clients they are serving can also tell you how much time they will be able to dedicate to you. You can also ask them how they are getting paid. Many agents get paid a commission when they sell you a product, but there are some who are paid a fixed salary. 

Before speaking to an agent, you can also check his or her credential via the MAS Register of Representatives to view their disciplinary records and employment history. 

Understand your problem first, seek a financial adviser second 

No one knows your financial situation better than yourself. Before meeting your financial adviser, you should aim to understand your financial situation. This means knowing your spending habits, current assets and liabilities, approach to investments and risk appetite.  

Think about your needs as well – do you have complex needs or a relatively straightforward one? If you require solutions for managing multigenerational wealth, running a business or for cross-border coverage, it can impact the experience level of the financial adviser you should be working with. 

There is also a wealth of information available online these days. Read up to better understand what you need to see if it tallies with what your financial adviser says. This can also prepare you to ask questions that will clarify doubts that you have. 

See your finances clearly 

One way to better understand your personal financial situation and coverage needs is to use Autumn – our finance and wellness app. We help aggregate personal financial information, from your savings and CPF to insurance and investments, on our app to give you a bird’s eye view of your situation.  

On Autumn, you can view your cash savings across multiple banks in various countries in one glance. You can also compile your CPF savings, track the market value of your investments with the latest information from Bloomberg, and plan your retirement with our Retirement Calculator and goal setting dashboard. This gives your sufficient information about what you need without the pressure of any sales pitches. 

Once you understand your current financial standing and determine the needs and goals that you have, your solution is a trustworthy and reputable financial adviser. 

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Enjoyed this article? Find more useful tips on money, health and life on the Autumn Blog, and watch this space for more stories.  

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The information in this article is not intended to be and does not constitute financial advice, investment advice, trading advice, or recommendation of any sort offered or endorsed by Autumn.

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