Who Is The Right Financial Advisor for You?

Who Is The Right Financial Advisor for You?

November 23, 2017
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I see it all the time. People hire personal trainers for their gym workouts – a professional who can guide them in the right direction. They wouldn’t think of “going-it-alone” with an exercise routine. Yet, when it comes to personal finance, they are reluctant to hire a professional. The problem is that, for most people, mastering personal finance is not easy.

Financial professionals can save you time and help you maintain the discipline required for long-term security and wealth building. If you are looking for a financial advisor, you want to find someone who’ll make the time to focus on your concerns and is committed to helping you achieve your personal financial planning goals. Financial advisors aren't the same as stockbrokers or accountants or insurance agents. Advisors help clients make decisions on how best to save, invest, and grow their money. Some may specialize in retirement or estate planning, while some others consult on a range of financial matters.

When you are ready to look for a financial advisor, I recommend that you interview a few before you make a decision. Here are five questions that will help you find the advisor that is right for you:

1. Are you an independent financial advisor?

An independent financial advisor is not an employee of an investment or financial services firm – they are an independent business owner. To be called independent, a financial advisor must follow a particular set of rules. They have to:

  • Offer a broad range of retail investment products, and 
  • Give clients unbiased and unrestricted advice.

2. Are you a fiduciary?

Fiduciaries must put your best interests first when making investment recommendations. They cannot be influenced by the amount or type of compensation they get paid.

3. What certifications or qualifications do you have? 

All financial advisors are required by law to meet some specific requirements. Quite a few advisors have taken additional exams, so it is worth asking what certifications the advisor has and what these demonstrate.   

4. Is your average client like me?

Some financial advisors limit their work to people who have a pension pot of a certain size, or a certain amount of money to invest. Others are happy to advise customers with modest income and assets. It may help you feel more confident if the advisor has a track record with clients who share your age, family status or personal goals. 

5. What do you charge and how much am I likely to pay?

Financial advisors are required by rule to tell you how much their services will cost before you're taken on as a client. They can charge an hourly rate or a fixed fee or a percentage of the value of your pension pot. But that information might not help you work out how much you could end up paying. If the advisor can’t give you a firm price, ask for an estimate or an upper limit. Find out if that includes ongoing services. The best financial advisors are trusted allies who are committed to helping you make wise and informed decisions about your financial future. 

Have questions? Are you looking for an independent financial advisor in DC?  Contact me today!

Material discussed is meant for general illustration and/or informational purposes only, and it is not to be construed as investment, tax, or legal advice. Although the information has been gathered from sources believed to be reliable, please note that individual situations can vary. Therefore, the information should be relied upon when coordinated with individual professional advice.