Interview: How do you find an objective financial adviser?
My good friend and Christian finance blogger, Jason Price, recently featured our conversation about "how to find an objective financial adviser" on his blog.
Here are a few excerpts:
How can you get objective advice when working with a financial adviser?
It’s unfortunate, but you really have to follow the money. Commission-based advisers are unable to recommend the full universe of financial products and their compensation can vary depending on which product they sell. Not good. Advisers who are employed by Wall Street firms are paid by the firm, not by you, so it is ultimately their employer who they answer to. Independent, fee-only advisers who are paid solely and directly by their clients and independently of the recommended product represent the most objective advice possible.
Why is the financial advice delivery system diseased?
You have companies that manufacture, distribute, and advise on products of their own creation. That’s like doctors getting paid based on the number of pills they prescribe you. There’s a reason that people are fed up with the financial industry and why they are so skeptical of Wall Street firms, banks, and insurance companies...
