Choosing an advisor is one of the most important financial decisions you will make. It will take some work on your part, but partnering with the right financial advisor can help reduce your financial stress and give you confidence and security today and in the future. Below are issues you will want to explore before you hire someone to be your financial advisor. You can ask these questions at your first meeting or send them in advance so the advisor is ready to address them when you meet. You might also find some of this information on the advisor’s website.
Whether you have been referred to a financial advisor by a friend or family member or have found one using our Find a CFP® Professional tool, be sure to interview the advisors you are considering to find the one who is the best fit for you.
1. WHAT ARE YOUR QUALIFICATIONS AND CREDENTIALS?
2. WHAT SERVICES DO YOU OFFER?
3. WILL YOU HAVE A FIDUCIARY DUTY TO ME?
4. WHAT IS YOUR APPROACH TO FINANCIAL PLANNING?
5. WHAT TYPES OF CLIENTS DO YOU TYPICALLY WORK WITH?
6. WILL YOU BE THE ONLY ADVISOR WORKING WITH ME?
7. HOW WILL I PAY FOR YOUR SERVICES?
8. HOW MUCH DO YOU TYPICALLY CHARGE?
9. DO OTHERS STAND TO GAIN FROM THE FINANCIAL ADVICE YOU GIVE ME?
10. HAVE YOU EVER BEEN PUBLICLY DISCIPLINED FOR ANY UNLAWFUL OR UNETHICAL ACTIONS IN YOUR CAREER?
These key words might come up during your conversation with a CFP® professional.
Some CFP® professionals may earn a commission on a transaction. Typically, a commission is compensation for buying or selling a financial asset, such as a stock.
When an advisor’s interests (including the interests of their firm) are adverse to the advisor’s duty to the client, or when an advisor has duties to one client that are adverse to another client.
There are different types of fees that a financial advisor might charge: You may pay a fee based on a percentage of the investable assets the financial advisor manages for you. You may pay an hourly rate, or a fixed fee by the service. You may also be able to pay a monthly or quarterly retainer fee (also known as a subscription fee) for the services of a CFP® professional on an ongoing basis.
The output of a collaborative process between client and advisor that helps maximize a client’s potential for meeting their individual life goals. The plan provides financial advice that integrates relevant elements of the client’s personal and financial circumstances.
Liquid and near-liquid assets that include cash, checking and savings accounts, stocks, bonds and mutual funds and retirement accounts and trust. Some advisors earn fees based on a percentage of the investable assets they manage for you.
