According to a recent Nigerian Financial Survey, the percentage of financial illiteracy was 31.1% in urban areas and 68.5% in rural areas. This high rate of lack of personal finance knowledge costs the average Nigerian lots of money.
To avoid these expenses, finding a good financial advisor will not only help you reduce debts but also help you focus on other financial goals. Working with a seasoned financial advisor is the best choice for anyone who is financially stuck and wants to get their finances on track and achieve long-term goals.
The following steps will help you find the right financial advisor for your personal and business needs.
1.Decide What Financial Services You Need
When considering choosing a financial advisor, the first thing is to decide the type of services you want from the advisor. There are many financial advisors and each of them caters for your specific needs. Some of them are;
- Retirement planning specialists (RPS) prepare you for life in retirement.
- Investment advisors provide investment advice to a client. They may also help manage your assets
- A financial coach helps clients with their finances and also build wealth.
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Decide What Type of Financial Advisor You Want
After deciding the type of financial services you need, the next thing is to decide the type of advisor you want. Many types of advisors can help you and their mode of operation is usually different.
The type of financial advisors that is suitable for your needs depends on your situation and how urgent you need help. There are three basic types of financial advisors;
- Traditional advisors -with them, you can build a more personal relationship.
- Robo advisors- they are the easiest type to work with as they provide a 24/7 service at a low cost
- Hybrid advisors- the best option for clients with advanced situation and they provide a low cost, automated investing platform.
Consider Your Budget
Working with professionals will require money and this is the aspect where you need to determine what you can afford. Deciding what type of financial advisors you can afford is also an important part of the process. Some advisors earn their compensation through an annual, hourly or flat fee, while others earn through commissions on the investments they sell and some earn through the fees and commissions.
Check the Advisor’s Credentials
Verifying the advisor’s credentials and portfolio is very important. The CBN website provides a list of disciplined financial advisors on its website. Apart from the CBN, some websites allow you to verify the credibility of financial advisors. Websites like businesslist.com.ng, nigerianinfoopedia.com.ng and the website of Nigeria’s securities and exchange commission provides useful information.
The financial industry just like any other industry today is saturated with many professionals and to get the best of them, you have to exercise caution and follow certain steps.
Although finding the right financial advisor can be quite a task, when you find the right one, they can assist you to achieve your financial goals and secure your investments.