7 Different Sources of Financial Advice the Economic Times

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  Business News›Wealth›Invest CHOOSELANGUAGE  सेे  34,869 -90.11  िनी   50 10,468 -20.45  सोने  (  एमसीए  ) (₹/ १०    ॅम  ) 31,830.00 -198.00  यू     एस     डी  / भारती  … 71.94 0.61  पोटफोिलयो  िनमाण     करा  MAR BY , ET BUREAU | UPDATED: DEC 10, 2018, 11.04 AM IST Post a Comment Big Change: The end of Five-Year Plans: All you need to know 7 different sources of financial advice: Which ones can helpyou? Everyone, including friends, relatives, colleagues and neighbours, doles out free financialadvice. But very little of this is useful. Here’s a look at the different sources of advice andthe likely impact these can have on your finances. 1. Mutual fund distributors  Distributors can give only incidental advice, which is restricted to selecting funds for investment. They do not charge a fee but earncommission from the higher expense ratio of regular schemes. Useful for small investors who can’t afford fee only advisers. 2. Insurance agents  Insurance agents help select insurance policies. While individual agents are tied to one company, corporate agents can sell productsfrom multiple insurers. They also change nothing and earn only from the commission. Commission drives their advice. 3. Bank relationship managers Most banks have relationship managers pushing mutual funds and insurance products. The advice is free of cost, but the bank earnscommission on investments. Banks are the biggest culprits when it comes to fl awed investment advice. 4. Stock brokers  In addition to providing a trading platform, brokers also recommend stocks to buy or sell. This advice is also free but the broker earnsbrokerage every time you buy and sell. Many stock brokers have also started mutual fund and insurance distribution verticals.  Also Read: Who needs money advice most: Rich, poor, young?  5. Wealth managers There was a time when only those managing very large portfolios (over Rs 1 crore) were known as wealth managers. Now, even aportfolio of Rs 25 lakh will have a wealth manager . There is usually a fixed fee (25-50 bps of AUM per annum) or variable fee (10-20% of  NARENDRA NATHAN 12:22 PM | 11 DEC MARKET STATS LIVE Search for News, Stock Quotes & NAV's  Powered by Live MarketNewsPortfolioMobileLive TVBiz ListingsIndustryNewslettersCommoditiesSpeedBlogsRSS About UsSubscribe to ET PrimeCreate Your Own Ad Advertise with UsTerms of Use & Grievance RedressalPrivacy policy FOLLOW US Download it from APP STORE Download it from GOOGLE PLAY Download it from Windows Store LTCG CalculatorAadhaar CardHow to apply Pan CardHow to link Aadhaar with mobile number HRA CalculatorPF Balance CheckHow to update AadhaarHow to link Aadhaar with PanHow to file ITRCalculate GratuitySukanya Samriddhi Yojana CalculatorIFSC Code Other Times Group news sites  इकनॉिमक     टाइ  | ઈકોનોિમક   ટાઈસ  | Pune Mirror   | Bangalore Mirror   |  Ahmedabad Mirror   | ItsMyAscent  | Education Times  | Brand Capital  | Mumbai Mirror   | Times Now  | Indiatimes  |  नवभारत     टाइ   |  महारा       टाइ   | ಜಯ   ಕಟಕ  | Go Green  |  AdAge India | Eisamay  | IGN India  | NavGujarat Samay  | Times of India  | Samayam Tamil  | Samayam Telugu  | Miss Kyra  | Bombay Times  | Filmipop  | Games App  | MX Player   Living and Entertainment Timescity | iDiva  | Entertainment  | Zoom  | Healthmeup  | Luxpresso  | Gadget Reviews  | Titanium & Platinum Credit Card  | Online Songs  | MensXP  | Hotels  | TravelDestinations  | Cricbuzz  | Recipes  | Gaana  | Happytrips  | Getsmartapp  Interest Network itimes Hot on the Web Stock market crash  | GST  | Rupee  |  Aadhaar Card  | Delhi News  | RBI  | Mumbai News  | How to save Income Tax  | Sensex Today  | Nifty Bank  | Telangana Elections  | IncomeTax Calculator   Services Book print ads | Online shopping  | Matrimonial  |  Astrology  | Jobs  | Tech Community  | Property  | Buy car   | Bikes in India  | Free Classifieds  | Send money to India  | Used Cars | Restaurants in Delhi  | Remit to India  | Buy Mobiles  | Listen Songs  | News  | TimesMobile  | Real Estate Developers  | Restaurant Deals in Delhi  | Car Insurance  | Gadgets Now  | Free Business Listings  | CouponDunia  | Remit2India  | Techradar   |  AliveAR  | Getsmartapp App  | ETMoney Finance App  | Feedback  |  Auto   In Case You Missed It Copyright © 2018 Bennett, Coleman & Co. Ltd. All rights reserved. For reprint rights: Times Syndication Service the additional returns earned above a pre-determined benchmark). Some wealth managers also earn commission on products they sell. 6. Robo advisers This new breed of advisers act as wealth managers for small investors. The advice (on asset allocation, fund selection, insurance plan)is doled out by computer algorithms and therefore lacks a personal touch. The charges are between Rs 1,000 per annum (for pure roboadvisory) to Rs 12,000 per annum (for customised personal advice). 7. Fee-only advisers   As the name suggests, these advisers don’t earn any commission from the products they recommend but earn a flat fee from the client.Since these registered investment advisers (RIAs) don’t earn commissions, there is no conflict of interest. However, make sure your RIAdoesn’t run an insurance agency or mutual fund distribution in the name of relatives. 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