3 Signs That Your Financial Adviser Isn’t Right For You
3 Signs That Your Financial Adviser Is Being Negligent
Have you ever found yourself wondering if the financial advice you were being given was genuine or just a way for your adviser to make a quick sale to earn commission from your purchase? We’ve put together a short list of statements that should serve as alarm bells if heard from your financial adviser.
A good financial adviser will not force or rush you into decisions with your money. Instead they will guide you into investments that suit your financial situation and risk level, educating you on every decision that is being made so you can make the final decision with your finances. This is unfortunately not always the case, with many financial advisers giving negligent advice to their clients in order to generate commission. If you hear your adviser suggest any of the following statements, you may want to reconsider your current situation and start asking serious questions about your financial security.
Your Financial Adviser Asks You To Sign Something Urgently
High pressure sales tactics have absolutely no place around your finances. Some advisers choose to mislead their clients into hasty and often risky decisions by claiming limited opportunities available. Clients who find themselves being rushed into decisions can make decisions which they later regret. Often times there are no real reasons to rush through an investment decision, especially in regards to large amounts of money.
You should be extremely aware of every decision you are making in regards to your finances and take the time to understand each and every investment that you are making. If at any point your feel pressured, ask for time to read over the documents which are being proposed to you and arrange a second meeting. Even if they claim urgency, do not rush, there will always be other opportunities in the future with less risk and more information available.
Your Financial Advisor Glosses Over Their Statement Of Advice With Little Detail
Financial advisors are required to provide relevant documentation to their clients in regards to the financial advice that they have given. Most importantly, they are required to provide a Statement of Advice or a SOA which explains in understandable terms what the client is committing to. Often time’s clients feel confused or overwhelmed by the sometimes complex details in their SOA and instead of reading it put their trust in their adviser.
It is vital that no matter how long your SOA is that you read it thoroughly before agreeing to any investments recommended by your adviser. You may find that certain statements don’t align with others or contradict your current financial situation, leaving you susceptible to high risk situations. Ask as many questions as you need to so you can fully understand what you are committing to, and if you are ever in doubt, ask for a second opinion from a trusted third party.
Your Financial Adviser Claims To Have Invested In The Same Product
This is a huge red flag to look out for and has led many investors astray into purchases they couldn’t afford. Financial Advisers are required to give you financial advice based on your individual circumstances. You have your own financial situation which your adviser should be catering their services towards, not repeating their own investments.
If your adviser personally recommends an investment because they have done likewise, this does not mean you should automatically follow suit. Even financial advisers can make bad personal decisions and may be leading you into the investment for unethical reasons. Ask your adviser to explain why the specific investment is right for you and your individual profile, if they can’t answer you directly, ignore the request and consider finding a new adviser.
Unfortunately, there seems to be a sales driven method being taken by more and more financial advisers which is leading to poor decisions and unhappy clients. If you have found yourself in financial hardship because of negligent advice from a financial adviser, you may be eligible for compensation. For more information on how to put together a successful claim for monetary compensation, contact the solicitors at the Investment Recovery Centre today on (02) 9011 7929 and regain your financial freedom.
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