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We all have a variety of financial goals that we want to accomplish. Why not engage a financial professional in order to help you meet those goals? How would you know they are the right fit for you? Take a moment and think about the folks in your corner or professional contact list….they probably include medical professionals, accountants, professional and personal mentors, and the list goes on. These experts help you with a variety of aspects in your life. So why not think about selecting the right financial expert to help you with the financial matters in your life?

When you meet with a financial advisor for the first time, this is your chance to interview him or her. You are the employer and they are interviewing for an opportunity to work with you. Therefore, go into the interview with questions you can ask all candidates. If you already have a financial advisor, make sure you can answer these questions. If you can’t, it’s never too late to ask them so you have some reassurance about your choice.

Here are six questions you’ll want to know the answers to in order to make your decision on which financial advisor to work with:

  1. What licenses/certifications do you have? This is important to know what qualifications do they have in order to give you sound financial advice. Although you may not be familiar with the different licensure, you can always check the FINRA’s website to know what is required and what they all mean. Financial advisors must have a “core” Series 6 or 7 license, but they could also have a 63, 65, or 66 Series license. If the advisor is selling insurance products, then they need to have a state insurance license also. Some other designations in the industry include Certified Financial Planner (CFP) and Certified Retirement Counselor (CRC). Note: You can also check the FINRA site to review an advisor’s disciplinary history, complaints, etc.
  2. What services do you and/or your firm offer? If you go with this individual and/or firm, what are you going to get out of it? Do they give advice only or can they give advice AND sell the financial products they’re recommending? What areas of financial goal planning do they cover? Also, request a sample financial plan and see if you are able to easily understand and interpret it.
  3. How do you charge for your services? There are a few different ways advisors are compensated so it is important for you to know which way your advisor will be and how much that will cost you. Some of the ways include a commission per product, a fee based account charged on a periodic basis, or an hourly fee. Advisors paid on commission must meet a suitability standard and those that are fee based are subject to a fiduciary standard and must put clients interests above their own. You’ll have to figure out what works best for you and your financial situation. An important note: an advisor should NEVER ask you to write a check to him or her. You should write checks ONLY to a brokerage, an insurance company, or another financial services firm.
  4. What is your investment approach? This question allows for you to see what type of “promises” or expectations the advisor can give you. If they are purely rate driven and/or speak mainly about beating the market performance, then you may want to look elsewhere. In order to make personal effective recommendations, the advisor has to consider your time horizon, risk tolerance, income, debts, and many other things to understand your financial picture and be able to help reach your financial goals.
  5. How often do you contact your clients? At minimum, you should meet with your advisor annually. Also, if you have a change in your life such as marriage, a child, inheritance, etc., then you should contact them for a meeting to see how the change effects your plan. Remember, you are the employer so you have the right to dictate how often you meet and what type of meeting (whether in person or phone). Additionally, you should be able to contact your advisor when needed and hopefully their response time falls within “a 24 hour” time frame. These contact methods can be from the advisor directly and/or a team member/someone from their firm, but be sure to clarify during your interview.
  6. Do you have a financial interest in the entity that houses my account? This question should be asked to advisors that are not associated with large brokerage or insurance companies. You will want to understand who they use as a clearing firm or independent third-party custodian. Using these entities prevents the advisor from having direct custody of your assets and adds another layer of security. In other words, this prevents another Bernie Madoff type situation.

Once you have the answers to the questions above, you have to ask yourself the most important question: Do I like this person? Mentioned previously, this person will be part of your corner and working with you, hopefully for the long haul, so a likeable relationship is important. If you have ANY reservations, then on to the next! The process will be well worth your time and money (of course)!

Lorielle Milbry

Lorielle Milbry has been in the financial industry for nearly 10 years helping individuals and business owners understand and meet their financial goals. She is passionate about educating and supporting local, national, and global communities through various volunteer activities and financial seminars. Ms. Milbry specializes in retirement income, education, and asset preservation strategies.