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Finance: Defining a financial adviser

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PHUKET: If you haven’t yet seen it, there’s a great episode of John Oliver’s ‘Last Week Tonight’ that covers the financial services industry in America. While it is a different beast in Southeast Asia, there were many points he brought up that are very relevant to expats in the region. Go onto YouTube and search for it if you haven’t seen it yet.

The first part he mentions is that in America, basically anyone can claim to be a financial adviser regardless of education. This is true – they only need to pass a very simple licensing exam that has nothing to do with understanding finance. I know this because I passed that exam many moons ago, and I also studied finance up through my MBA. I say that not to brag either, as neither has stopped me or my clients from being preyed on by greedy Wall Street scumbags in the past. In hindsight, I think these horrible experiences have probably been the ‘real’ education in my life.

What is more concerning is the difference between a fiduciary and an ordinary adviser.

Most financial advisers in the US are not even required by law to act in your best interest. Here, only Thai people are actually allowed to be financial advisers. However, they are not regulated to advise on international jurisdictions, only Thai securities.

Many people mistakenly think I’m a financial adviser, but in Thailand I’m only allowed to provide service linking policy holders to our regulated office in Malaysia. This is similar to the service you could get in Thailand when a representative of your bank in Singapore deals with you.

However, if you use a regulated jurisdiction, such as Singapore, Hong Kong or Malaysia for international advice, you are still just as likely to require ‘luck’ to land someone with an ethical backbone, to look after your best interests instead of some insurance company or bank.

Basically, this is pretty much the situation all over the world, regardless of the regulations or legal framework. This does not mean you should bury your money in the sofa and never trust anyone. It just means you need to be an informed consumer of any type of financial service.

In John Oliver’s segment, he also mentions heavy, sometimes hidden fees. Of course, he kind of does advisers an injustice by neglecting to address that many of them work without salary, spend most of their working hours giving advice that turns out to be free, and have often spent a fortune on their education to do so. There is a huge opportunity cost for someone who could earn a nice cushy salary in a big company that chooses to offer you financial advice instead.

I am not the one to say what a fair compensation is, but just keep that in mind when examining fees. I often use funds with high fees because the underlying managers consistently outperform, and that is something I am willing to pay for.

Of course, index funds are an alternative for those who are not so investment savvy, and John Oliver recommends those on the show. If you read my articles regularly, you know I also recommend that route, but he fails to mention ‘how’ to invest in those.

So, for those of you who haven’t been following, my article next week will explain again how to do just that, for those of you who wish to save for retirement in the markets without using a financial adviser.

David Mayes, MBA, resides in Phuket and provides wealth management and life coaching services to expatriates around the globe, specializing in UK pension transfers. He is a regional representative of Faramond Group, located in Kuala Lumpur, Malaysia. Faramond UK is regulated by the FCA to provide advice on pensions and taxation. He can be reached at 085-335 8573 or david.m@faramond.com

— David Mayes

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Archiving articles from the Phuket Gazette circa 1998 - 2017. View the Phuket Gazette online archive and Digital Gazette PDF Prints.

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Governments & old media versus social media – who will win? | VIDEO

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Governments & old media versus social media – who will win? | VIDEO | The Thaiger

We look at the recent changes made by the Australian and Indian governments to except control over the world’s biggest social media platforms. India has issued strict new rules for Facebook, Twitter and other social media platforms just weeks after the Indian government attempted to pressure Twitter to take down social media accounts it deemed, well, anti social. There is now an open battle between the rise of social media platforms and the governments and ‘old’ media that have been able to maintain a certain level of control over the ‘message’ for the last century. Who will win?

The rules require any social media company to create three roles within India… a “compliance officer” who ensures they follow local laws; a “grievance officer” who addresses complaints from Indian social media users; and a “contact person” who can actually be contacted by lawyers and other aggrieved Indian parties… 24/7.

The democratisation of the news model, with social media as its catalyst, will continue to baffle traditional media and governments who used to enjoy a level of control over what stories get told. The battles of Google and Facebook, with the governments of India and Australia will be followed in plenty of other countries as well.

At the root of all discussions will be the difference between what governments THINK social media is all about and the reality about how quickly the media landscape has changed. You’ll get to read about it first, on a social media platform… probably on the screen you’re watching this news story right now.

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The social media giants in battle with ‘old’ media and world governments | VIDEO

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The social media giants in battle with ‘old’ media and world governments | VIDEO | The Thaiger

“The rules signal greater willingness by countries around the world to rein in big tech firms such as Google, Facebook and Twitter that the governments fear have become too powerful with little accountability.”

India has issued strict new rules for Facebook, Twitter and other social media platforms just weeks after the Indian government attempted to pressure Twitter to take down social media accounts it deemed, well, anti social.

The rules require any social media company to create three roles within India… a “compliance officer” who ensures they follow local laws; a “grievance officer” who addresses complaints from Indian social media users; and a “contact person” who can actually be contacted by lawyers and other aggrieved Indian parties… 24/7.

The companies are also being made to publish a compliance report each month with details about how many complaints they’ve received and the action they took.

They’ll also be required to remove ‘some’ types of content including “full or partial nudity,” any “sexual act” or “impersonations including morphed images”

The democratisation of the news model, with social media as its catalyst, will continue to baffle traditional media and governments who used to enjoy a level of control over what stories get told.

The battles of Google and Facebook, with the governments of India and Australia will be followed in plenty of other countries as well.

At the root of all discussions will be the difference between what governments THINK social media is all about and the reality about how quickly the media landscape has changed. You’ll get to read about it first, on a social media platform… probably on the screen you’re watching this news story right now.

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Never miss out on future posts by following The Thaiger.

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Turbulence ahead for Thailand’s aviation industry | VIDEO

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Turbulence ahead for Thailand’s aviation industry | VIDEO | The Thaiger

When the airlines, in particular, were asking the government to put their hands in their pockets for some relief funding in August last year, it was genuinely thought that international tourists would be coming back for the high season in December and January. At the very least local tourists and expats would head back to the skies over the traditional holiday break. And surely the Chinese would be back for Chinese New Year?

As we know now, none of that happened. A resurge in cases started just south of Bangkok on December 20 last year, just before Christmas, kicking off another round of restrictions, pretty much killing off any possibility of a high season ‘bump’ for the tourist industry. Airlines slashed flights from their schedule, and hotels, which had dusted off their reception desks for the surge of tourists, shut their doors again.

Domestically, the hotel business saw 6 million room nights in the government’s latest stimulus campaign fully redeemed. But the air ticket quota of 2 million seats still has over 1.3 million seats unused. Local tourists mostly skipped flights and opted for destinations within driving distance of their homes.

As for international tourism… well that still seems months or years away, even now.

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