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Key Questions to Ask Your Financial Advisor While Running a Business

It’s normal for a financial advisor to ask you questions regarding your business the first time you go for a consultation.

They do that to determine how they can help you resolve your financial matters.

However, what about the questions that a business owner should be asking? If you don’t have a financial background, you’ll be clueless about what you should ask your financial advisor. Business owners should also ask questions that can help in planning for better results. Here are a few questions that you can ask your financial advisor as a business owner.

1. What services can I expect from you as your client?

This is the first question any business owner should ask a financial advisor, in answer of which they will provide a walk-through of all the services they offer. They may offers a wide range of services, such as income tax, bookkeeping, financial planning, investment management, and others. You can even ask them to create a budget plan for the next five years according to your current financial position. Listen to what they have to say, and put forward your needs to reach a mutual contract.

2. How do you charge your clients?

The answer you should be looking for is a fee-only method. You’ll come across many advisors who will ask for a commission plus fee, but don’t fall into the trap. There are numerous financial advisors willing to work for a particular fixed fee. Their key objective should be to make as much money as they can for your business. If the commission factor is added, the advisor’s primary focus will be to earn as much commission as they can.

3. How far am I from my goal?

You should explain all your goals and objectives, which you have set for your business, to your financial advisor. Ask them how you can reach your goals and how long it will take. The plans and budgets that they make for your business will indicate all future tactics that need to be adapted to progress. At any time after hiring a financial advisor, ask them this particular question to get an analysis of your current position and the improvements required in the process. They will also provide you insights into better opportunities that you can pursue for better results.

4. What should my primary focus be in the upcoming quarter/year?

Many business owners aren’t very good at analysing the market trends or economic shifts that take place. That’s where a financial advisor comes in; to guide you by providing helpful suggestions and future plans to help you survive. They inform you before time about any change that is about to take place, so that you can plan accordingly. If a financial advisor fails to provide you with market forecasts, then it’s better to replace them or their firm.

5. Is it the right time to invest?

Businesses generate a lot of revenue and retained earnings that are stored in their bank accounts. Instead of increasing your bank balance, you should invest by purchasing shares from the stock market, expanding your venture, or by starting another business.

However, it’s preferable to consult a financial advisor before making such a move. Business owners are so busy in overseeing their day-to-day operations that they sometimes don’t have time to study the prevailing market conditions. So instead of making a blind move, ask your financial advisor to provide you with a detailed report and suggestions regarding your investment plans. They will inform you about better alternatives and help determine the right time to invest.

Availing the services of a financial advisor is becoming a common trend amongst top business leaders. They provide their clients with helpful financial reports and budget forecasts that can come in handy when making important business decisions.

Steven McMeechan is a strategic marketing and communications specialist with over twenty years’ experience in senior marketing management roles across a range of industries including Information Technology and Financial Services. He works for Capstone Financial Planning and lives in Melbourne Australia.

Written by:

Steven McMeechan is a strategic marketing and communications specialist with over twenty years’ experience in senior marketing management roles across a range of industries including Information Technology and Financial Services. He works for Capstone Financial Planning and lives in Melbourne Australia.

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