Finding the Right Canadian Financial Advisor


For many Canadians, finding the right Canadian financial advisor is key to achieving their financial goals. Whether they’re saving for retirement, paying down debt or trying to manage the cost of raising a family, they rely on their advisors to help them navigate the complex financial world.

But it’s not always easy to know if you’re getting value for your money. A new study by CIBC and FP Canada finds only 25 per cent of Canadians work with an advisor, while 30 per cent say they don’t have a financial plan at all.

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The good news is that, according to the study, those who do get advice — especially millennials and high-net-worth investors — are significantly more likely to report success in meeting their financial goals than their non-advised peers. That’s why it’s important to understand how advisors are paid and to find out if you’re being charged the most cost-effective rate.

Most financial advisors are compensated through commissions, either as an upfront charge for each product sold or as a “trailing” fee that lasts as long as the investor holds the product. However, this system can create a conflict of interest because it gives advisors an incentive to sell products that pay the highest commissions. This is why it’s so important to find out how your advisor is being paid before you sign a contract. Fortunately, there are alternatives to embedded commissions, like flat or hourly fees that can help you save on your investment costs over time.

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