Look out for the salesman posing as a financial saviour

This is an opportune moment in our series to cover some pointers on choosing advisers, when necessary, to help you with both your immediate and long-term financial planning goals. For me, there is nothing worse than a cold call from a pushy salesman pretending to know what is best for my financial planning. This is usually followed up with conversations so in-your-face that the more easily intimidated listener will fall victim to the spiel. I know many professionals, by the way, who have been that "listener".

So, where to start? Anybody can call themselves a "professional adviser" or "expert", so you need to devise a due diligence check list. Keep in mind that there are different types of advisers; the most relevant to our daily needs tend to be either a lawyer, financial planner, stockbroker, investment adviser or tax planner. A reference by a family member or friend is always a good way to start your search. Not all "experts" offer a comprehensive slate of services, so make sure your needs are similar to the person referring you. Interview a few advisers to decide who is compatible with your style and can deliver the services you need.

A financial planner handling wealthy clients may not be suitable if you are a first-time house buyer: you could end up paying high fees and not be a priority to the adviser even if his or her advice is good. Banks often provide services in financial planning, stockbroking and investment advice, so yours might also be included on your list of resources. If you are going independent, what degree or special credentials are you looking for?

If it's a lawyer you're after, make sure they have passed the relevant exams and have sufficient experience in, say, conveyancing. Big law firms may provide you with brand comfort but they can be expensive because of their large overheads. Financial planners, brokers and investment advisers will have likely been required to have passed exams specific to their particular profession - you may see their certificates hanging on the wall behind their desk. If not, don't be shy to ask what accreditations they do have.

Financial planners are compensated in different ways, and you should understand the differences. They may work under a "fee-only", "fee-based" or "commission-based" system. Fee-only is for advice given; fee-based usually involves commissions on certain products sold, although most of their compensation comes from fees, and commission-based schemes are paid to the planners by the companies whose products they are selling.

Beware of the latter for any potential conflicts of interest, because you want to ensure that your portfolio is stocked with products in your best interests. During interviews with adviser, it is a good idea to ask for some references - for example, one or two of his or her current clients can provide you with some objective feedback. Above all, try to get a good feel for how the adviser has performed during periods of economic distress.

As a rule of thumb, make sure that your adviser is under the umbrella of a recognised body or council and, where relevant, regulated. This will provide you with recourse in the event that you feel you have been treated unfairly, negligently or fraudulently. The UAE Central Bank maintains on its website a list of financial advisory firms it has accredited to operate in the country; go to www.centralbank.ae Once you have hired the services of an adviser, remember that the quality of advice given is normally correlated to how well your adviser knows you. The more you understand about your own circumstances, the better he or she can assist you.

Make sure you understand the products you are examining and ask how much the adviser is going to make from selling you the products: always beware if someone keeps trying to push a particular fund or stock on you - commissions can be very tempting. John McGaw is a financial adviser based in Dubai. Contact him at jmcgaw@emirates.net.ae