India Markets open in 8 hrs 11 mins

When Should You Change Your Investment Advisor

Adhil Shetty


Investment advisors play an important role for an investor as they help customers to achieve financial goals in a planned manner. You trust them with your hard-earned money and follow their advices to let your money grow. Therefore, it is crucial to have a good advisor as a bad one could prove disastrous for you and your money. Being an investor, it is your duty to be alert and keep a check on your investments on a regular basis. It is better not to be blindly dependent on your advisor all the time. If need arises, you should take remedial steps before your investment journey meets an unexpected end.

Here are the five situations or warning signals on when you should start considering changing your investment advisor.

Advisor Does Not Connect On A Regular basis

Usually advisors keep investors posted with updates and reviews on his/her portfolio on a regular basis, with a call or two every month initially. But, the real test begins when time passes by, say a year or two, without your financial advisor connecting with you. You should consider it as the first sign of warning. Remember, engagement with advisors and investors is quite an important aspect of investment. It not only builds relationship but strengthens the trust and confidence between the two.

You Are Not Listened To

There are times when your advisor doesn’t listen to you. Sometimes, your calls are not answered. Even after a reasonable and acceptable duration you don’t get a call back. Further, if your advisor starts giving less or no heed to your current problems and keeps pestering you with investment advice he had offered you earlier without change, it’s time for you to be alert. As an advisor, it’s his first duty to hear you out patiently. If he fails to do so as per your expectations, you may take it as a signal to break out with your advisor sooner than later.

Your Advisor Calls Only When He/She Has To Sell

Even if your advisor connects with you regularly, you should consider what he/she is up to every time the call comes. If your financial advisor is interested in selling some product every time he rings you up, it’s time to review your advisor. It is worth to remember that advisor’s main job is to hand hold the investors, review portfolios and suggest the best possible advice to investors and not necessarily always pitch to sell a product.

Advice Remains Same Despite Changes In Your Financial Situation

During the investment tenure, an advisor needs to observe the financial situation, requirements and goals of an investor. You as an investor may see an increase in income or sudden health emergency, which will alter your financial goals or add new ones. The financial advices should also change in line with these new changes or life events. If you find that the advice from your financial advisor does not change, you need to flag this and demand immediate actions. Before it’s too late, it is advisable to go for a second opinion and if situation demands, you must not mind changing your existing advisor, no matter how long have you been in association with him/her.

Portfolio Value Does Not Grow

Always remember you have hired your financial advisor to help you create wealth in the long run while addressing your financial goals. If you find value of your portfolio increases steeply when markets rise and the value declines sharply with fall in markets year-on-year; with no reasonable growth in the investment portfolio value, it’s a clear indication for a change in advisor. However, do remember, that this should be the case for several years and not only for a year or two. There are several years where value of portfolio does not increase and you should not be worried about it. But if this persists for several years, you might need change in advisory. There could be a possibility that schemes or financial products suggested to you may not either be appropriate or they may not be good performing schemes or products.

The writer is CEO, BankBazaar.

BankBazaar.com is a leading online marketplace in India that helps consumers compare and apply for credit cardpersonal loanhome loancar loan, and insurance.