Updated: Oct 29, 2021
Before committing to a financial advisor, you want to ensure you’re hiring the right person for you and your circumstances. Your financial adviser is in charge of complicated duties that have a significant influence on your life; that’s why you need someone who is both knowledgeable and reliable. So, before choosing which financial advisor you want to work with on this lifelong venture, you should thoroughly research each applicant. To aid you in this endeavor, we've compiled the following list of questions to ask each financial advisor you meet with.
1. What Are Your Credentials?
You've undoubtedly seen several fancy acronyms next to the names of people who work in financial services. All of these terms have distinct meanings, and they all indicate that the financial advisor you're considering is qualified in a specific area. Your objectives determine the sort of financial advisor you hire. Discuss each candidate's qualifications with them and determine what qualifies them to provide you advice and oversee your assets.
If you want to do more research on specific qualifications after discussing with a potential advisor, check out the Financial Industry Regulatory Authority’s professional designations database. In this database, you’ll find information on all the various titles, qualifications, and more.
2. How Will We Communicate in This Relationship?
You can't just establish a financial plan and let it operate on its own. You should review it periodically to ensure that it continues to meet your needs as your life evolves. To do that, you'll need to touch base with your advisor periodically. Before you choose to hire a specific advisor, find out how they will communicate with you, when you will meet, how often they are available outside of meeting hours, etc. Most importantly, from the answers you acquire, make sure their communication style is compatible with your own.
3. What Services Do You Provide?
You must know not only how much financial advisors charge but also what you receive for that price. Some advisors, for example, can create a financial strategy for you but not manage your assets. Others specialize in certain parts of your money, such as tax planning. Before you engage a financial adviser, you should understand what services are included in the fees you pay and what services are not.
4. How Long Have You Been Helping Clients?
Look for a financial advisor who has guided clients in navigating market turbulence and unpredictability. When the stock market is rising, it's simple to perform well for your clients. During imperfect markets, an advisor's true worth is put to the test. Inquire about how long and in what capacity advisors have been assisting clients.
5. Can You Explain One Financial Concept to Me?
Education is one of the most critical services provided by a financial adviser. They assist you in sorting through the enormous quantity of information and determining what is relevant to you. This means it's vital that your adviser interacts with you in a way that you understand. When you ask an adviser to explain a financial concept, you're searching for a clear answer that will tell you if their method of explanation will work in the future.
6. How Much Do You Charge For Your Services?
Financial advisors can charge in various ways, so you must inquire about and understand any fees involved. Flat fees, hourly rates, fee-only, commission payments, and other cost structures are all possible with advisers. Some financial advisers may even be paid using a combination of compensation methods. Knowing how a financial adviser is compensated will give you a better idea of how diligently they will work for you.
7. Who Is Your Custodian?
Most financial advisers work with a specific firm that acts as a custodian for your funds, such as a bank, brokerage, or insurance company. Instead of putting your money solely in your adviser's hands, you may put it in a brokerage account, which your advisor will handle for you. When your adviser gives you a statement detailing how much money is in your account, you may verify it with the custodian. This prevents your adviser from diverting your funds without your permission, as Bernie Madoff did with his clientele.
8. How Do You Measure Client Success?
How do they evaluate your financial success? This is a great question to ask a financial adviser. While they should be analyzing your return on investment with them, they should also be assessing things like client satisfaction in addition to financial gains. Advisors should be able to assess your financial wellness in various ways while you're working with them. Pay attention to how they handle this and whether or not they have a plan that demonstrates how they will track your achievements and overall performance.
9. Why Should I Hire You?
This last question has no right or wrong answer, but a good financial advisor should have one. Yes, it may appear somewhat subjective, but it can provide you with precious information. It demonstrates that they've paid attention to how they interact with clients and the type of connection they wish to establish.
Schedule A Consultation with an Experienced Financial Advisor
The journey to finding the right financial advisor is not a one-size-fits-all process, nor does it happen overnight. However, there’s no better time to get started on this journey than right now. We here at Fourth Avenue Financial invite you to begin your search with us. Our first priority is your overall financial success. We want to help you develop, implement, and monitor a strategy designed to address your individual situation to ensure all your investments are setting you up for a path of financial success. If you are ready to start planning for your financial future, we are here to help. Contact us today at (304) 746 7977 to schedule a meeting with one of our experienced financial advisors or schedule online: https://bit.ly/3nbIQjr. We look forward to answering all of the questions from this article for you and more!
Securities are offered through J.W. Cole Financial, Inc. (JWC) Member FINRA / SIPC. Advisory Services are offered through J.W. Cole Advisors, Inc. (JWCA). Fourth Avenue Financial and JWC/ JWCA are unaffiliated entities.