Finance

How do I choose the right financial advisor?

Simon Parfitt of Pyrmont Wealth Management helps answer this question.

Deciding on a financial advisor is one of the most important decisions you make – pick a bad one and you could face a future of financial heartache.  Living in a foreign country can make this decision even more daunting.  So how do you decide which financial adviser is right for you in Hong Kong? Other than “Do I trust this person?” and “Can I see myself working with them for a long time?” there are deeper questions you might want to ask when considering who to work with.

#1 How are they regulated?

Some HK firms only hold insurance licenses and so the solution for clients will be insurance-based products, which won’t suit everyone. They also don’t require advisors to be properly licensed to give investment advice, which could be dangerous for you. An SFC (Securities and Futures Commission) license is required for giving investment advice, and allows advisors to be impartial and recommend non-insurance-based products.

financial advisor in Hong Kong

#2 How are they paid: commission or fees?

If it’s the former, it’s your right to understand what they’ll receive. Avoid those who suggest their services are free or skim over the question by saying they’re paid by a third-party provider.

#3 What is their investment philosophy?

A good financial advisor should be able to explain in a simple way how your money will be invested. It’s also important to know how they’ll choose investments: Is this done inhouse? Do they use a third party?

#4 What are the investment costs?

Expensive charges can really impact the growth and future value of your investment. Some funds have entry fees or exit penalties of up to 5 percent, which are used to pay an extra commission to the person selling them.

#5 What’s their experience?

What qualifications do they have and how do these relate to the advice they’re giving? What do they invest their money in?

 

Simon is regulated by both the HK Confederation of Insurance Brokers (011833) and the Securities and Futures Commission (BGY807).
6017 4140 | simonparfitt@pyrmontwm.com | pyrmontwm.com

 

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This article first appeared in the October/November 2018 issue of Expat Living magazine. Subscribe now so you never miss an issue.