Big Picture, Financial Planning, Millennials

8 Question To Ask Before You Hire An Advisor (And Why/What Answers To Look For)

Looking to hire a financial advisor towards the end of this year? 🤔

I want to help you out! 👇

Here are some important questions to ask when hiring an advisor and why they’re important! 📝

1) Are you a fiduciary?

Many advisors are not required to act in your best interest. Typically, these advisors are one’s who can sell products like annuities, insurance, etc. You want an advisor who is obligated to act in your best interest (fee only)

There are plenty good advisors in this model, but fee only has the least conflicts of interest and requires them act in your best interest

If your advisor does sell products, you at least want them to be independent and able to shop from many companies

2) What services do you provide?

Advisors do different things for different people. Some do full financial planning. Some do just investments. Some help with business planning.

Find the one that aligns with your needs, but full financial planning will give you the most value typically. Your whole financial picture works together, you want someone who will help make sure they work together well 

3) What do you charge & how do you get paid?

You need to be aware of fees. Some charge AUM, some charge subscription, some get paid through the products you implement. Know all of these plus hidden ones like portfolio cost.

4) How will the relationship work? How often do we meet?

You want to know the process, how often you meet, do they charge more for extra meetings, etc. Take advantage of the relationship and find someone who won’t nickel and dime you for every little thing

5) What’s your investment belief?

Some do individual securities, other index funds, others crypto. Find someone who aligns with your core beliefs around investing & someone who won’t just force you to do what they think, but will be collaborative & help you build wealth your way

6) Who do you do your best work for?

The best advisors are specialists, not generalists.

If you are young, work with an advisor who specializes in your age range

They will have a process around working with you that is different than what it’s like to work someone in a different life stage

Specialization allows advisors to go deep, generalization has them go wide

The deeper knowledge they have into your life & the problems you face, the better

7) How do you define/measure success for your clients?

Some measure through investment growth, others through goals hit, etc.

Find someone who’s main objective is to help you use you money to live the life you want

That’s the goal with money right?

Some advisors could be the best at tax optimization and investment growth but if that’s the only focus and you can’t live the life you want along the way, it’s pointless

8) Do you have any reviews from existing clients/what do clients say about working with you?

This is a huge question, you want to know why people just like you love their advisor and how they help. Look at their google reviews