Leaving your money just lying around is considered a waste. For this reason, many put their money in savings accounts that earn them interest. However, you can opt to invest the extra cash instead of putting it in a savings account. Investment may be in various forms. You can decide to invest your money in government securities, real estate, bonds, and stocks.
Notably, not many know about investing and worthwhile investments. Consequently, there are investment advisors to guide you on the right investment to give you a good return. A good investment Advisor ensures less risk in your investment. Here are some key factors you should consider when looking for an investment advisor.
First is the reputation of the Investment Advisor. Do a background check of the investment advisor. Look at the testimonials of his previous clients. Are they saying positive things about him or her, or the company? Do not just blindly choose an investment advisor. If the advisor has a good reputation, they will probably hand-pick for you the best investments to consider them.
Confirm whether the investment advisor is licensed. Just like any other business person, investment advisors need to be licensed. Licensing acts as proof of their legitimacy and authenticity. An investment advisor may be licensed as a financial advisor, broker, or consultant. Request that they show you a copy of their licenses. If they hesitate or are reluctant to do so, that may be a red flag.
Also, consider the service fee charged by a particular investment advisor. Getting advice on which investment to make is a service that is charged by the advisor. Various investment advisors charge different fees. Consider an investment advisor with a good reputation and charges affordable fees. Expensive fees may reduce the returns you will get.
Moreover, ensure that you and the investment advisor are legally bound. You can do this by both of you signing a contract, which legally binds the both of you. This is useful as it reduces the risk of being conned. Countercheck the contract and, if possible, hire the services of a lawyer. If things go southwards, you can sue the investment advisor. Contracts are mostly applicable if your investment advisor also happens to be your portfolio manager.
Lastly, look at the extra incentives provided by the investment advisor. Some investment advisors may offer to manage your investment portfolio for free or at a subsidized rate. Such investment advisors are ideal. They will save you the extra cash of looking for a portfolio manager. This way, you will be able to get advice and at the same time get someone to invest on your behalf.
Conclusively, an investment advisor is pivotal when investing. They hold extra knowledge on investments, which might not be at your disposal. Significantly, hiring the right investment advisor gives you an edge over other ‘blind investors’. Choose the right investment advisor, and you are on your way to getting a good return on your investments. Happy investing!