Experts believe there are six types of financial advisor, and which one you choose to use to handle your finances often depends on what your goals are, or how much you have to invest.
Also known as a stockbroker, this type of money manager often possesses more sales acumen than financial knowledge. They can be especially good at winning over new clients and securing sales commissions. If you need advice that doesn’t require any financial analysis, then this type of advisor is acceptable.
If you want to get shot of bad stocks in your portfolio, a stockpicker is the person to turn to. This type of financial advisor will also help build up your portfolio with more favourable options. Obviously, you’ll pay a fee for their portfolio expertise, but if you choose a good stockpicker, this will more than pay for itself. The problem is, knowing which stockpicker will prove their worth, and which ones won’t. Relying on previous successes isn’t an indicator of how results will pan out going forward.
A trustee is someone who manages the finances of someone else, often because that person isn’t capable of doing so. According to the Money Advice Service, a trustee manages the money of a person, will only use it in that person’s best interest, and must obey the rules of the trust.
Financial advisor software, such as that supplied by https://www.intelliflo.com/financial-adviser-software, has revolutionised the way that people can manage their finances and build their portfolios. For the most effective solutions, it makes sense to combine the use of financial planning software and human intervention. Relying on a computer only, or robot-advising, can be advantageous in specific scenarios, but won’t suit all types of financial planning.
The financial advisor who is a percentage planner will charge you a percentage of your assets in return for their monetary expertise. This can include advice on mortgages, retirement funding and savings, for instance, so there’s ample scope. Look for percentage planners who are certified financial advisors, to ensure you are getting better advice for your money, compared to gladhanders.
The hourly planner will charge a fixed rate per hour for their financial advice services, as opposed to a percentage fee. In some cases, this could prove financially more beneficial. However, such advisors are hard to come by.