What to Look for in a Financial Advisor


Finding someone to look after your money can be stressful. But you want to take your time to make sure you choose the right fit. What should you look for when choosing a financial advisor?

Here are some questions to keep in mind when looking for an advisor to continue planning for your retirement.

Are they a complete planner?

When you meet a potential financial advisor for the first time, what advice do they offer you? Do they only talk about stocks and bonds? Or do they focus on other aspects of your finances like social security, taxes, and estate planning?

To subscribe to Kiplinger’s personal finances

Be a smarter, more informed investor.

Save up to 74%

Sign up for Kiplinger’s free email newsletters

Enjoy and thrive with Kiplinger’s best expert advice on investing, taxes, retirement, personal finance and more – straight to your email.

Profit and thrive with the best expert advice from Kiplinger – straight to your email.

A complete financial planner (opens in a new tab) will help you develop a holistic plan that looks at all aspects of your finances and covers your short and long term goals. Advisors who use a holistic approach will take the time to ask you questions about your current and future financial goals. This could include everything from inheritance planning to charitable giving. You want an advisor who truly understands your retirement hopes. A holistic plan seeks to optimize all aspects of your finances and how they can work together to achieve those goals. This type of planning will bring you much more value and help you make complex financial decisions.

Are they trustees?

A fiduciary (opens in a new tab) is legally and ethically bound to make the best decisions for its clients. They will always put your needs first. This may not be the case for many advisors. When you choose a financial advisor, you are looking for someone to help you manage all of your finances. You want to be sure that you can trust them to do this.

A fiduciary cannot recommend anything that does not benefit you. If a recommendation could result in a potential conflict of interest for your advisor, as fiduciary, he must inform you. It could be something as simple as an advisor profiting more from one investment than another. When they are fiduciaries, you know that the recommendations they give you come from a place of trust, good faith, and legal and ethical duty.

Are they an independent advisor?

An Independent Advisor receives a flat fee for advising their clients and wants to provide you with more than a product. This is very different from advisors who work on commission. They make money based on their sales for a third party. Beware of advisors who work on commission. Their recommendations may be based on sales and not on which products or services are best for you.

Consultants who work for larger companies may be authorized to offer only their company’s specific products or services. Working with an independent advisor leaves you open to many other options for your money.

Are they a good personality for you?

Your values ​​and goals should match those of your financial advisor. When you leave a first meeting, ask yourself if you got anything out of it. Your advisor should be able to simplify complicated financial matters. You might meet someone who ticks all of your strategic boxes, but if they don’t match your personality, you can keep looking. It’s an important decision, and you want to make the right one.

Improve your financial future

A recent poll found that about 38% of Americans (opens in a new tab) are currently working with a financial advisor, and advisors are the most trusted place to get financial advice.

Planning your financial future is a process that takes years and you don’t want to make any mistakes. Make sure you’re working with the right people who make the best decisions for you and your money.

This article was written by and presents the views of our contributing advisor, not Kiplinger’s editorial staff. You can check advisor records with the SEC (opens in a new tab) or with FINRA (opens in a new tab).


Comments are closed.