Insurance adviser? Financial adviser? Which do I choose?

In this industry, we’ve heard some frequently asked questions, especially regarding the different types of wealth advisers or financial consultants. We’ve listed them down here to help you make your decision on the service that best suits your needs.

1.Which one do i choose: an insurance agent, unit trust fund agent, financial adviser? Are they all wealth planners? 

An insurance agent or unit trust fund agent might call themselves wealth planners, but their services only cover one part of wealth planning. Your wealth planner should be able to advise you independently and comprehensively. Your wealth management plan must cover a wide range of products. You don’t want to put all your eggs in one basket. 

2. How can I tell if they are advising me objectively and not just trying to sell me a product? 

Your financial adviser or wealth planner should not be affiliated with a single insurance company or financial institution. They should be able to help you compare between the various options in the market and pick which one best suits your needs and brings the best returns. 

3. Which qualifications or certifications should an independent financial adviser (IFA) possess? 

In Malaysia, an IFA should have these three licences: 

  • Capital Market Service Representative Licence from the Securities Commission (SC) 
  • Financial Advisor Representative Licencefrom Bank Negara
  • Corporate Unit Trust Advisor Licence from the SC  

4. Is an individual with a CFP certificate automatically recognised as an IFA? 

No. An individual with either a CFP (Certified Financial Planner) or Registered Financial Planner (RFP) certificate might decide not to apply for the required licences from the relevant regulators to practise as an IFA. 

5. Do I need to be rich to engage the services of an IFA?

No. The fees charged by IFAs are reasonable and depend on your asset size. While it’s never too late to engage the services of an IFA, it’s better to get it right, from the start. The sooner, the better, so you can avoid costly mistakes. 

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