What to Do If My Financial Adviser Is Out Of Business?

Financial Advisors out of business

There comes a situation or time when the financial adviser you’ve been trusting for some time is out of business. He/she may be facing financial, operational or institutional challenges that inevitably force them to close down business. What are the major indicators that your financial adviser is out of business?

Ineffective Marketing

You will notice that the financial adviser marketing campaign is slacking 

Financial Advisors out of business

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Inactive Website

You will notice that the financial adviser’s website has not been updated in a long time. There is also no interaction on the platform.

They Are Being Slippery

You will notice that when you are asking questions they tend to be slippery. They do not answer in a clear way or just cannot plainly answer.

Massive Client Withdrawal

You will also notice that the financial adviser’s client base is quickly dwindling.

Delayed Responses

When official responses aren’t done in a timely manner and there is no clear reason as to why they are being delayed.

Unclear Expectations

You will experience a situation where the adviser doesn’t give a clear contract and thus you’re not sure of what to expect, and they also don’t know what you expect.

With the above indicators, what is it that you can do to remedy the situation? It is imperative that you pick a new adviser so as to secure your investment. You ought to find one that is able to meet your financial objectives.

The process of switching could take about a week. The new financial adviser will assist with the transfer and most of the paperwork. The shift of assets could also take a week. Your former adviser can assist by availing the files that contain all your financial information for the ease of this transfer.

Some advisers may charge for the closure of accounts so make a point of establishing whether they charge. It is advisable though to keep the account open for some time till your shift to the new financial adviser is complete.

If you decide to sell your assets be cautious of selling assets that you have owned for a short period. The amount of tax that you will pay on the sale of assets held in the short term is much higher than those held in the long term.

With regard to your account at the former financial adviser, it’s important to note that you cannot trade in the account.

With regard to the sale of assets, if your asset portfolio consists of annuities and structured notes, it may be hard to sell these assets since they are often sold in complicated ways. Ask the former financial adviser to help you in this regard. If your asset portfolio consists of cash, bonds, and Exchange Traded Funds (ETFs), it will be easy to sell these type of assets if you choose to. The process of selling them is comparatively easy.

Lastly, it’s important to note that you owe no one an explanation for your change of advisers. After all, you have no incentive to having an adviser who is out of business.

If you notice that your financial adviser is out of business, you should take immediate action so as to secure your investment. You can shift to another financial adviser if need be.

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