Alice Haine | August 28, 2013
For many expats, September heralds a pick up in the pace of work and less time to freshen up financial plans and investment strategies.But as Chris Ferguson, managing director of Guardian Wealth Management in the UAE, warns expats need to be wary when they take on a financial advisor. Here are his tips on how to find the best adviser to suit your needs.
With people too busy to spend time on their finances, many UAE expats falling prey poor financial advice given by advisers drawn to the region’s large potential market of clients enjoying high disposable, tax free incomes.
A major trap for expats is to assume all English speaking advisers are regulated by the UK authorities or that UK regulation negates the need for registration with the local authorities. Depending on the type of advice being given, this is all too often not the case.
So despite the hot temperatures, now more than ever is the time to keep a cool head and look out for the common warnings signs that could safeguard your finances. Here are three every expat can watch out for:
1. Business cards
Don’t be lulled into a false sense of security by a smart looking business card. Concentrate instead on the information it provides. As well as the adviser’s name, any business card should also have the name of the advisory firm and local contact details. This information gives you the valuable means to check credentials with regulators and supervisory authorities. If any of the information given is withheld or incorrect then steer clear. Remember protection afforded by a UK regulated authority does not necessarily extend overseas. Local regulations often take precedence, so a UK regulated firm that is also authorised to operate locally is preferable.
2. Telephone calls
Expats are often subject to scam cold calls so make it a rule to only talk about your finances when you have verified the identity of the person and firm you are speaking with. Any adviser worth his or her salt will only call a client they have a relationship with or an introduction in order to organise a meeting to discuss financial planning options rather than sell an investment product. Meetings are the best way to assess whether or not services on offer are suitable for your needs.
3. Personal recommendations
A firm’s reputation is often upheld by personal recommendations and client testimonials, but be wary of overuse. Personal recommendations are all well and good, but only really mean anything if you take the trouble to follow them up. Treat all client testimonials like references for a job – if you don’t verify the references given you only have yourself to blame if things go wrong.
From my experience over the years, expats are a particularly vulnerable class of client. Multi-currency and multi-jurisdictional issues make financial planning far more complex for those living and working abroad, not to mention the difficult task of getting to grips with the many different regulatory frameworks involved.
You need to be satisfied you are dealing with someone you trust before you move on to the next stage of your financial planning journey. For some this can be the most difficult part of the process as it involves divulging lots of personal financial details and digesting many unfamiliar terms. I see many clients who (wrongly) feel that they must possess all the answers and understand plans put forward immediately. They don’t. That’s the job of a good financial adviser who will put suggestions and recommendations in writing so you have a proper chance to mull it all over and so avoid hasty decisions that you will regret at leisure.