Oct 03, 2017

Finance planning is not always objective.  It's heart breaking to know that your financial advisor is basically trained to be a sales person rather than working for your best interest. However, this remains an unfortunate fact to date.

Many people end up trusting financial advisors with their life, money, and blood, at the same time paying absolutely no heed to the truth that they are all in it for the money. 

Because of this quirk of fate we have decided to unravel some of the facts your finance advisor would never want you to realize. So, for making your future finance life easier to tackle, here are some financial advisors’ secrets revealed.    

They Always Work for a commission

Almost all financial advisors earn not only by taking fees from their clients for managing their money and investments, but by also making BIG commissions on your money. How is that accomplished? It’s pretty easy to  figure it out. They make commissions and bonuses on each sale they make using your money. They have monthly targets to achieve. Why on earth would they always call you with something to purchase at the end of the month?

They work with an approved list of investments

When clients like you place your hard-earned IRA’s in their hands, how does your financial advisor come back to you within a day and say, “I think we have found the best stock or fund for you!”?

Unlike what you might like to think—these kinds of ideas do NOT come to them after they have spent hours in a room full of computers doing research. Instead, they have this assigned list of investments which are approved by the finance company they work for. Their research department has assigned them with a particular list, according to which they place each investor in certain bonds and funds, etc.

Breaking this down for you in simpler words: Financial advisors are not ‘finding’ the right investment for you; they are rather ‘presenting’ a particular investment to you, claiming it to be exactly ‘right’ in your case. 

They put you into Funds

Another secret which is going to make you pretty angry is that financial advisors often put you into certain funds and funds are already managed by experts. These experts might not make the right decision but they are professionals that are focused on funds.  When your finance advisor, whom you are paying to manage your portfolio, places you in a fund, it means they are just giving their task to someone else, and taking money from you just for doing that.

Furthermore, when you are out buying a mutual fund, see if you have any better option at hand. For almost every fund that has sales charges, there exists one which has no charges. So yes, keep digging on your own.

YES, They CAN Give Discounts

Yes, they can provide their clients with discounts. After all, they are simply charging them for financial advice. Most of them will never tell you this because come on, who shares this secret? No one, apparently.

Are they really ‘Advisors’?

This one secret is probably the worse. Majority of the advisors are salespersons or salary workers, NOT ‘Advisors’. There are two types of workers in the finance sector. First, there are those salespeople who build their selling from the ground up, and then there are salaried workers who are financing advisors at the bank. Do you think their company or bank actually pays them to hand you the best piece of advice? No, they are just gaining salaries by doing their jobs.

So, now you know all the secrets which financial advisors have kept hush-hush. The next time you are out for monetary advice, think twice before you trust a stranger with your savings. 

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