Member Article

Important Facts on Financial Services, Kent

A professional financial advisor is the one who provides financial guidance to the clients for compensations. Financial advisors are also known as investment planner or wealth manager. There is a certain group of investment planner who uses the title of the financial advisor. Those are financial planners, accountant, lawyer, tax preparers, stock brokers, insurance agents, bankers, etc. There are many different services provided by the financial advisors or investment professionals such as income tax preparation, investment management, estate planning etc.

Financial advisors Kent must hold the “series 65” license to manage the business with the customers, in the USA. Though there are many varieties of licenses a professional must carry to provide financial services to the clients.

Types

Based on the Kent financial services we can divide the financial advisors into two different categories.

1. Independent Financial Advisor (IFA): IFA can freely interact with their clients and can provide advice on the financial matter independently. They can recommend any suitable financial plans or products without any regulations. According to the new rule, from 2013, IFA is not allowed to receive any commission from the financial service companies.
2. Restricted Advisor: A restricted advisor can offer some limited advice and they can only recommend some certain financial products or financial product providers or both. The advisor can only consider the product of the company that they are working for. They focus on a particular market.

The first and main rule that a financial advisor should follow is to inform their clients or customers, whether he provides an independent advice or a restricted advice.

Service to provide

Depending on the role, the tasks of the financial advisors varies. The tasks involve with the financial service are:

• To set up a meeting the advisor should first contact the client and choose a comfortable venue for the meeting. It can be either the client’s home or the office.
• Should have a complete knowledge of the financial condition, current provision and future goal of the client.
• Based on the client’s requirements, the advisor should prepare the best plan by analyzing the information.
• Complete risk analysis
• Research about the certain market
• Provide the complete information of the new or existing product or services to the client.
• Draw financial strategies
• Assisting clients to make decisions by providing the information
• Collect information from various sources about the providers of the financial product
• Responding to the changing need and financial conditions of the client
• Promote the certain financial product
• meet the sales target
• Negotiate with the product providers for the best possible rate
• Cooperate with the head office of the financial service providers
• Communicate with the other professionals regarding all the matters of their particular zones
• Up to date with the financial services and laws and regulations
• Make financial reports
• Contacting clients with the news of launching new financial product or change in legislations that may affect their savings and investment plans.

Salary or compensation

A financial planner or advisor can either be compensated through typical salaries or fees or commissions. They can be compensated by following ways

• A flat fee
• An hourly fee
• A typical annual fee for asset management
• A commission on buying or selling securities or assets
• A commission based on the principle amount invested by the client
• A markup: when a client buys housing bonds or properties
• A markdown: when client sales the bonds or properties

Laws & Regulations

As we stated above, in the USA, a financial advisor should carry the “Series 65” license in order to conduct business with the clients. According to investment advisor act of 1940, a financial advisor should fulfill all his duty to the client. That means the advisor must consider the client needs and interest above all by all means.

According to Security Exchange Commission (SEC,), the financial advisor should make a responsible recommendation regarding client’s investment. The recommendation should be based on the complete inquiry about the financial product because it would eventually reflect the investment decision that a client would make. An advisor should always consider the client’s interest and need ahead of his own.

Qualifications

Though this zone of work is open to graduate degree holders or diploma degree holders in any discipline, the following subjects are always preferable for this type of job.

• Finance or Financial Studies
• Business Management
• Accountancy

This was posted in Bdaily's Members' News section by CA Financial Services .