Seven Important Considerations In Hiring A Financial Advisor

Choosing a financial advisor can be a challenging process and often requires a great deal of effort. Advisors come in all shapes and sizes and each one can have a different set of qualifications. They may work for small independent companies or large investment firms.

The good news is that a careful examination can be done to help make your advisor search easier. There are several essential items to consider when selecting a financial advisor that can be used as a guideline to help you through the process.

Things you should be aware of when choosing an advisor:

1. How do they get paid?

In the previous twenty years, the financial profession has created a lot of debate and negative media because of its compensation arrangement. Often times the type of compensation that is most vulnerable to producing problems within the client-advisor relationship is in the form of commission.

A commission is a fee that is paid when an investment product is sold, which is often not disclosed to the client. The product can be an investment or insurance, such as life insurance, long term care, or an annuity. This commission rewards the advisor for placing the client into a product, not for providing advice or guidance.

Frequently, the advisor is then motivated to suggest products so they can get paid, which destroys the real premise of remaining unbiased and impartial for the client. The best course of action for someone looking for the help of a financial advisor is to search for one that is compensated by a “fee for service.”

In addition, it is worthwhile to seek out an advisor that does not get paid by any commission-based product which could include limited partnerships, annuities, mutual funds, and all forms of insurance.

2. What is their knowledge and experience?

As with all professions, knowledge is critical, even if their business has been in existence for quite some time, because their organization can’t oversee each piece of guidance and direction they would be providing you. Make certain that the potential advisor has a sufficient amount of experience.

3. Is their regulatory record clean?

It is essential to know the prospective advisor’s ethical record. The easiest way to find this information is by exploring their records through the regulatory agencies. The most trusted resource is the FINRA website – You can also make inquiries through the SEC if they are a Registered Investment Advisor. If they are a CERTIFIED FINANCIAL PLANNER Professional, you can make inquiries about them through the CFP board.

4. Do they have any credentials?

This is imperative for several reasons. First, it is a sign of their knowledge, expertise and proficiency within their profession. Some legitimate qualifications to look for would be CFP®, CERTIFIED FINANCIAL PLANNER, CFA, Chartered Financial Analyst, and ChFC. The most admired for financial planners is the CFP®.

Second, it helps you decide whether or not their heart is in their profession. The majority of these credentials involve quite a lot of effort and devotion to acquire.

5. Do they use a proven Investment Process?

One of the major reasons why people get themselves into trouble when investing is because they never hold fast to a stringent discipline. This goes for an advisor as well. It is astounding how many advisors position their clients into the market without an established investment process in place.

When a severe market decline occurs, their clients frequently suffer more than they bargained for. Make sure the potential advisor has been using a demonstrated investment process that has a track record of withstanding severe market environments.

6. What planning services do they offer?

There are several important areas within the sphere of financial planning that the advisor needs to be skilled in and can display that they have provided. You should acquire a careful understanding of all the areas of planning that they provide, and possibly see some examples of their work. This will assist you in getting a better idea of the level of their proficiency and the quality of their advisement.

7. What is their longest client relationship?

Finding out how long their clients have been with them will tell you how satisfied their clients are, and how long they have been providing a superior of service.

While there are several items that you ought to consider, the key is to prepare yourself in advance with the right questions so that you can make an educated decision.

How to Find a Financial Advisor!

How to make your choice

We all know by now the types of financial advisors existing today; it’s essential to decide which type to go for first. There are financial advisors and independent financial advisors; the first one functions as a part of a firm or a similar financial institution while the other operates like a freelancer. That makes sure one thing; with an independent financial advisor, your options are more. A financial advisor shall thus providefinancial advice- which is correct – but then again, financial advice is a very broad term requiring fine-tuning.

To be precise, financial advices are as many as the number of financial products and strategies available in the market; there also remains a question on their individual suitability. A financial advisor is the one who matches them up and therefore; it’s a specialized service that you require for better results.

Let’s see what can be achieved from an independent financial advisor. An IFA doesn’t hold any contract whereas others remain bound by contracts with financial institutions (e.g. life insurance or mortgage companies) or work directly under the company’s payroll. Therefore, why a contract bound/employed financial advisor may suggest going for a financial product sold by the same financial company – maybe that’s not meant to suit you completely – an independent financial advisor shall select a plan tailor-made to your needs if all other readily-available financial packages fall short. So now that you’ve known the difference, it’s time to learn how to choose the best.

Questions to ask

The regulatory body of financial services (FSA or Financial Services Authority) has put up certain requirements for any person willing to work as an IFA. This is something you need to enquire about when you are on the process of finding a suitable independent financial advisor; for those working under some financial institution, their credibility can be verified with the employing company. A Certificate in Financial Planning is the bare minimum; if there are advanced qualifications showing, it is all the better. These qualifications are specialization based, for example, an IFA dealing in mortgages must have a Mortgage Advice Qualification (MAQ) or a certification from the Association of the Pensions Management Institute (APMI) and so on. Just remember that the field an IFA is providing his services for must tally with the degrees he/she has earned so far. Ask your questions as you feel, but the abovementioned points must stay included in the answers you receive. And always remember; don’t hesitate to take any free quote that’s available. It helps to gain some idea on who’s more correct to address your needs. 

What to expect next

Be prepared to reveal your entire financial history to the chosen financial advisor, from your most silly impulse spending to your long-term financial goals and everything that’s influencing your current spending habits. The financial advisor shall then choose for you a package, but it’s always better to get it verified from another source.

Finding the Advisor Match for You

However, with, you can save yourself from the hassles of collecting free quotes or the cross-verification process; finds the best Financial Advisor to ensure you a faster and surer entry to a brighter financial future.

Top 5 Things To Consider When Getting A Moving Quote

Moving is often a huge challenge on its own and deciding on the ideal moving company to fit your funds and goals is not an easy feat. Understanding how they function, reach their prices, and what is included, are important aspects in the shopping process. These represent the top 5 items to consider, when finding a moving estimate.

1. Comprehending the Types of Quotes

Much like many other services for hire, moving companies employ a pricing method to project exactly what the consumer’s charges are going to be after services are rendered. However, it is really not enough to simply shop around, because there are several terms to be aware of when approaching moving service quotes. First of all, you should create the primary difference between non-binding and binding quotes. A non-binding estimate is when a moving service figures the weight of your belongings and derives a price from it, which can be modified up or down after the move is completed. This can be different from a binding quote, which is usually a more concrete agreement. This means that the price quoted is exactly what the client ultimately owes.

2. Does the Quote employ a Ceiling?

While it is necessary to be aware of the contrast between a non-binding and binding quote, the main aspect of the estimate is whether or not the figure is recognized as, “not-to-exceed.” This means that whatever you end up spending cannot surpass an original estimate that was provided. The appeal of this kind of characteristic is pretty obvious, since the client can know the maximum total that’ll be owed to the moving company, upon finishing the work. Just like other businesses working to make a profit, movers are known to overestimate their quotes higher. This unfortunate fact can make quotes that are lacking a not-to-exceed feature more risky in contrast to those that come with them.

3. Knowing the Weight of your Property

Weight can be a significant factor that is commonly employed by moving companies to price their services. Since their laborers will be carrying the customer’s belongings, they normally use this as their basic way of creating a price, when working up an estimate. Movers charge by the pound, so knowing their system of reaching their prices are a very important part of the experience. However, you should not solely concentrate on this aspect, seeing as there are other determinants that make up the quote.

4. Compute the Distance between Locations

As weight is one of the major factors utilized by moving companies to formulate the prices, the distance that is covered during the move will be the other. These fees, which might be known as linehaul charges, make up the remaining bulk of the bill. Since they’re quoted in miles or kilometers, it is especially necessary for the customer to accurately calculate the distance in advanced after which you can compare it to what the moving company is claiming it to be. Most pros encourage working with a GPS or Internet source, like Google Maps, to reach precise projections.

5. Finding out what is Included in the Price

While many moving companies use options, including weight and distance, to arrive at their estimation, there are additional factors to consider when shopping around. Communicating with them might help flush out what’s included in their professional services as well as possibly discover any hidden fees which they may be opting to keep tight-lipped about. Discovering that their services involve more than a closely priced competitor could easily be a determining factor and get more value for your money. Bear in mind, you get what you pay for, so accepting the cheapest bid for strictly financial reasons could result in numerous complications later.

Financial Definitions; L thru Q

The ever increasing number of investment products and financial services in the marketplace today can be confusing. We have put together this glossary of financial definitions designed to help you understand some of the more common investment and financial terms you may encounter. Your financial advisor can explain these terms more completely and discuss with you those which are relevant to your situation.

Legal List – A list of investments selected by various states in which certain institutions and fiduciaries, such as insurance companies and banks, may invest. Legal lists are often restricted to high quality securities meeting certain specifications.

Leverage – The effect on a company when the company has bonds, preferred stock, or both outstanding. Example: If the earnings of a company with 1,000,000 common shares increases from $1,000,000 to $1,500,000 – earnings per share would go up from $1 to $1.50, or an increase of 50 percent. But if earnings of a company that had to pay $500,000 in bond interest increased that much – earnings per common share would jump from 50 cents to $1 a share, or 100 percent.

Liabilities – All the claims against a corporation. Liabilities include accounts, wages, and salaries payable; dividends declared payable; accrued taxes payable; fixed or long-term liabilities, such as mortgage bonds, debentures and bank loans.

Limit, Limited Order, or Limited Price Order – An order to buy or sell a stated amount of a security at a specified price, or at a better price, if obtainable after the order is represented in the trading crowd.

Liquidation – The process of converting securities or other property into cash. The dissolution of a company, with cash remaining after sale of its assets and payment of all indebtedness being distributed to the shareholders.

Liquidity – The ability of the market in a particular security to absorb a reasonable amount of buying or selling at reasonable price changes. Liquidity is one of the most important characteristics of a good market.

Listed Stock – The stock of a company that is traded on a securities exchange.

Load – The portion of the offering price of shares of open-end investment companies in excess of the value of the underlying assets. Covers sales commissions and all other costs of distribution. The load is usually incurred only on purchase, there being, in most cases, no charge when the shares are sold (redeemed).

Locked In – Investors are said to be locked in when they have profit on a security they own but do not sell because their profit would immediately become subject to the capital gains tax.

Long – Signifies ownership of securities. “I am long 100 U.S. Steel” means the speaker owns 100 shares.

Manipulation – An illegal operation. Buying or selling a security for the purpose of creating false or misleading appearance of active trading or for the purpose of raising or depressing the price to induce purchase or sale by others.

Margin – The amount paid by the customer when using a broker’s credit to buy or sell a security. Under Federal Reserve regulations, the initial margin requirement since 1945 has ranged from the current rate of 50 percent of the purchase price up to 100 percent.

Margin Call – A demand upon a customer to put up money or securities with the broker. The call is made when a purchase is made; also if a customer’s account declines below a minimum standard set by the Exchange or by the firm.

Market Order – An order to buy or sell a stated amount of a security at the most advantageous price obtainable after the order is represented in the trading crowd.

Market Price – The last reported price at which the stock or bond sold, or the current quote.

Maturity – The date on which a loan or bond comes due and is to be paid off.

Member Corporation – A securities brokerage firm, organized as a corporation, with at least one member of the New York Stock Exchange who is an officer or employee of the corporation.

Member Firm – A securities brokerage firm organized as a partnership and having at least one general partner or employee who is a member of the New York Stock Exchange.

Member Organization – The term includes New York Stock Exchange member Firms and Member Corporations.

Merger – Combination of two or more corporations.

Money Market Fund – A mutual fund whose investments are in high-yield money market instruments such as federal securities, CDs and commercial paper. Its intent is to make such instruments, normally purchased in large denominations by institutions, available indirectly to individuals.

Mortgage Bond – A bond secured by a mortgage on a property. The value of the property may or may not equal the value of the bonds issued against it.

Municipal Bond – A bond issued by a state or a political subdivision, such as county, city, town or village. The term also designates bonds issued by state agencies and authorities. In general, interest paid on municipal bonds is exempt from federal income taxes and state and local taxes within the state of issue.

Naked Option – An option position that is not offset by an equal and opposite position in the underlying security.

NASD – The National Association of Securities Dealers, an association of brokers and dealers in the over-the-counter securities business.

NASDAQ – An automated information network that provides brokers and dealers with price quotations on securities traded over-the-counter. NASDAQ is an acronym for National Association of Securities Dealers Automated Quotations.

Negotiable – Refers to a security, title to which is transferable by delivery.

Net Asset Value – Usually used in connection with investment companies to mean net asset value per share. An investment company computes its assets daily, or even twice daily, by totaling the market value of all securities owned. All liabilities are deducted, and the balance divided by the number of share outstanding. The resulting figure is the net asset value per share.

Net Change – The change in the price of a security from the closing price on one day to the closing price on the next day on which the stock is traded. The net change is ordinarily the last figure in the newspaper stock price list. The mark +1 1/8 means up $1.125 a share from the last sale on the previous day the stock traded.

New Issue – A stock or bond sold by a corporation for the first time. Proceeds may be used to retire outstanding securities of the company, for new plant or equipment, for additional working capital, or to acquire a public ownership interest in the company for private owners.

New York Futures Exchange (NYFE) – A subsidiary of the New York Stock Exchange devoted to the trading of futures products.

New York Stock Exchange (NYSE) – The largest organized securities market in the United States, founded in 1792. The Exchange itself does not buy, sell, own, or set the prices of securities traded there. The prices are determined by public supply and demand. The Exchange is a not-for-profit corporation of 1,366 individual members, governed by a Board of Directors consisting of 10 public representatives, 10 Exchange members or allied members and a full-time chairman, executive vice chairman and president.

Non-cumulative – A type of preferred stock on which unpaid dividends do not accrue. Omitted dividends are, as a rule, gone forever.

NYSE Composite Index – The composite index covering price movements of all common stocks listed on the New York Stock Exchange. It is based on the close of the market December 31, 1965 as 50.00 and is weighted according to the number of shares listed for each issue. The index is computed continuously and printed on the ticker tape. Point changes in the index are converted to dollars and cents so as to provide a meaningful measure of changes in the average price of listed stocks. The composite index is supplemented by separate indexes for four industry groups: industrial, transportation, utility and finance.

Odd Lot – An amount of stock less than the established 100-share unit.

Off-Board – This term may refer to transactions over-the-counter in unlisted securities or to a transaction of listed shares that is not executed on a national securities exchange.

Offer – The price at which a person is ready to sell. Opposed to bid, the price at which one is ready to buy.

Open Interest – In options and futures trading, the number of outstanding option contracts, at a given point in time, which have not been exercised and have not yet reached expiration.

Option – A right to buy (call) or sell (put) a fixed amount of a given stock at a specified price within a limited period of time. The purchaser hopes that the stock’s price will go up (a call) or down (a put) by an amount sufficient to provide a profit when the option is sold. If the stock price holds steady or moves in the opposite direction, the price paid for the option is lost entirely. There are several other types of options available to the public but these are basically combinations of puts and calls. Individuals may write (sell) as well as purchase options. Options are also traded on stock indexes, futures, and debt instruments.

Overbought – An opinion as to price levels. May refer to a security that has had a sharp rise or to the market as a whole after a period of vigorous buying which, it may be argued, has left prices “too high.”

Oversold – The reverse of overbought. A single security or a market which, it is believed, has declined to an unreasonable level.

Over-The-Counter – A market for securities made up of securities dealers who may or may not be members of a securities exchange. The over-the-counter market is conducted over the telephone and deals mainly with stocks of companies without sufficient shares, stockholders, or earnings to warrant listing on an exchange. Over-the-counter dealers may act either as principals or as brokers for customers. The over-the-counter market is the principal market for bonds of all types.

Paper Profit (Loss) – An unrealized profit or loss on a security still held. Paper profits and losses become realized only when the security is sold.

Par – In the case of a common share, par means a dollar amount assigned to the share by the company’s charter. Par value may also be used to compute the dollar amount of common shares on the balance sheet. Par value has little relationship to the market value of common stock. Many companies issue no-par stock but give a stated per share value on the balance sheet. In the case of preferred stocks it signifies the dollar value upon which dividends are figured. With bonds, par value is the face amount, usually $1,000.

Participating Preferred – A preferred stock, that is entitled to its stated dividend and, also, to additional dividends on a specified basis upon payment of dividends on the common stock.

Passed Dividend – Omission of a regular or scheduled dividend.

Penny Stocks – Low-priced issues, often highly speculative, selling at less than $1 a share. Frequently used as a term of disparagement, although some penny stocks have developed into investment caliber issues.

Point – In the case of shares of stock, a point means $1. If ABC shares rise 3 points, each share has risen $3. In the case of bonds a point means $10, since a bond is quoted as a percentage of $1,000. A bond that rises 3 points gains 3 percent in $1,000, or $30 in value. An advance from 87 to 90 would mean an advance in dollar value from $870 to $900. In the case of market averages, the word point means merely that and no more. If, for example, the NYSE Composite Index rises from 90.25 to 91.25, it has risen a point. A point in this index, however, is not equivalent to $1.

Portfolio – Holdings of securities by an individual or institution. A portfolio may contain bonds, preferred stocks, common stocks and other securities.

Preferred Stock – A class of stock with a claim on the company’s earnings before payment may be made on the common stock and usually entitled to priority over common stock if the company liquidates. Usually entitled to dividends at a specified rate – when declared by the Board of Directors and before payment of a dividend on the common stock – depending upon the terms of the issue.

Premium – The amount by which a bond or preferred stock may sell above its par value. For options, the price that the buyer pays the writer for an option contract (“option premium” is synonymous with “the price of an option”). May refer, also, to redemption price of a bond or preferred stock if it is higher than face value.

Price-Earnings Ratio – A popular way to compare stocks selling at various price levels. The PE ratio is the price of a share of stock divided by earnings per share for a twelve-month period. For example, a stock selling for $50 a share and earning $5 a share is said to be selling at a price-earnings ratio of 10.

Primary Distribution – Also called primary or public offering. The original sale of a company’s securities.

Prime Rate – The lowest interest rate charged by commercial banks to their most credit-worthy customers; other interest rates, such as personal, automobile, commercial and financing loans are often pegged to the prime.

Principal – The person for whom a broker executes an order, or dealers buying or selling for their own accounts. The term “principal” may also refer to a person’s capital or to the face amount of a bond.

Profit-Taking – Selling stock which has appreciated in value since purchase, in order to realize the profit. The term is often used to explain a downturn in the market following a period of rising prices.

Prospectus – The official selling circular that must be given to purchasers of new securities registered with the Securities and Exchange Commission. It highlights the much longer Registration Statement file with the Commission.

Proxy – Written authorization given by a shareholder to someone else to represent him or her and vote his or her shares at a shareholders’ meeting.

Proxy Statement – Information given to stockholders in conjunction with the solicitation of proxies.

Prudent Man Rule – An investment standard. In some states, the law requires that a fiduciary, such as a trustee, may invest the fund’s money only in a list of securities designated by the state – the so-called legal list. In other states, the trustee may invest in a security if it is one that would be bought by a prudent person of discretion and intelligence, who is seeking a reasonable income and preservation of capital.

Quote – The highest bid to buy and the lowest offer to sell a security in a given market at a given time. If you ask your broker for a “quote” on a stock, he or she may come back with something like “45 1/4 to 45 1/2.” This means that $45.25 is the highest prices any buyer wanted to pay at the time the quote was given on the floor of the Exchange and that $45.50 was the lowest price that any seller would take at the same time.

A complete listing of financial definitions can be found by visiting

How to Access the Best Mortgage Quotes

These are tough times to be a homebuyer. Getting a mortgage has been more difficult for the past two years than ever before, and it’s easy to get frustrated with the quotes and restrictions you’re facing. If you’ve been researching mortgage quotes online, or using the financial pages to find a good deal, you may be confused with the terminology, or just be unsure about whether you qualify for the mortgage plan you’re interested in.

The best way to get great mortgage quotes is still to talk to an independent financial adviser. There are many reasons why this is a great choice, but two are vitally important:

Access to market – an independent financial adviser has access to the whole mortgage market. This is important because it means you can look at mortgage quotes from companies you didn’t even know existed, and which certainly don’t make it to the Sunday papers or even to some online comparison sites. Even in these difficult lending conditions, there are hundreds of different products on the market, and you need an adviser that can access those products and match them to your needs.

Personal advice – it’s easy to underestimate how important personal contact can be. Taking out a mortgage is likely to be the biggest financial commitment of your life, so it makes sense to approach it carefully and to take advice from the experts. Having a meeting with a qualified, regulated independent adviser means that you can talk about your needs and your plans, work out what you can afford and have the confidence in your mortgage product that comes from the personal touch. Your questions can be answered and your worries explained.

As long as your independent financial adviser is authorised and regulated by the Financial Services Authority (FSA), you can be sure that they are working to a strict code of conduct and that your interests are at the heart of everything they do. Get personal advice and the best mortgage quotes by talking to an adviser today.