Financial consultants are self-employed firms or institutions which provide professional advice on financial planning and financial management. Financial consultants offer analysis and guidance to businesses and individuals in making investment decisions. They add value to an individual or individuals and family, by helping them lay out what their overall needs are and articulate their goals. Financial consultants cannot make the goals up but help the client to understand how their finances can help meet those goals. Financial consultants assess the economic performance of companies and industries for firms and institutions with money to invest.
The help may be required almost always. The advices have proven to be realistic during the years of bad markets that we had during the years 2000-2003. Before 2000, we had amazing markets and there were a lot of people investing over the internet and online and getting short-term profits. People thought that there really wasn’t a need for financial adviser or financial consultant because of how well they could do on their own. However, that period of boom ended in a big bust. The majority of clients, who followed the advices from them had a good sound financial plan, didn’t suffer during the downtrend. But those without the advice and guidance from the financial consultants had strained their finances resulting in a huge loss. While, an appropriate financial planning is a roadmap towards success, they are the one who chart this roadmap.
Why do people avoid financial consultants?
There are three practices that are prevalent, when it comes to taking financial advice of the financial consultants:
o Many people believe that only they can plan their own finances. They think that reading a few books/business magazines/newspapers, browsing through financial websites and watching some business channels are more than enough to make investment decisions.
o Even when an agent is involved, they expect him to pass some portion of the commission he or she earns.
o To hire financial consultant services by paying them fees, just as they would do for a doctor or a lawyer or an accountant etc., is practically unheard of.
It is important to appreciate the fact that the investment world is huge which comprises of shares, mutual funds, bonds, post office schemes, credit cards, home loans, insurance etc. Each investment module has its benefits, drawbacks and typical terms and conditions. It is difficult for an ordinary person to behave extraordinarily in every circumstance. In fact, even an advisor would usually specialize in some specific fields only.
Hence, when a lot of hard-earned money is at stake, it is not advisable to save a few thousands of rupees in advisory fees of financial consultants. Good interpersonal skills and ability for working with numbers are among the most essential qualifications. Intense competition is anticipated for these highly paid positions, despite rapid job growth; those who have earned a professional designation or an MBA are expected to have the best opportunities to earn as a financial consultant.