So, you’re now looking to have better cash flow, minimize your taxes, and get rid of your debts. You also want to save and invest for short to long-term financial goals, right? There’s also the matter of facing financial risk like an unpredictable stock market, preparing for the education of your children, building your retirement fund, and considering the benefits of estate planning. Money management habits need to be nurtured.
So, with these concerns in mind, what are the questions you need to consider when selecting a potential financial advisor?
What do you hope to find out about a prospective advisor?
It’s always good to ask about the background of experience in these matters. Try to find out more about professional designations and related associations. Inquire about the services the advisor can provide and just what he or she can or can’t advise on.
In terms of remuneration, will your advisor be an independent contractor or does he or she have to answer to some higher-ups? Are you okay with the advisor being independent? Or are you comfortable with the advisor’s superiors? Please delve deeper into whether the advisor will work for your interest or for the benefit of his or her company.
Payment usually comes through commissions or referral fees. Try to get more information about how to settle your advisor’s billing requirements. A detailed list of what needs to be paid and what you will be getting for your money will be helpful.
Will you be satisfied with this collaboration?
No one likes having a “yes” man. Your financial advisor is there to provide you with the most viable financial moves that will do more good than harm in terms of your solvency. So, your advisor must strongly advise you not to spend beyond your means. Be prudent and strict with putting enough away for your retirement. And have the will to break the bad news that you really can’t afford that new house or car.
The important question to consider here is if the advisor is capable of guiding you in making the financial decisions that are always in your best interest. It may hurt in some way, like not getting what you want, but the advisor is only doing what will provide you with less financial stress and worry about your future.
Who has he or she advised? Were these pieces of advice satisfactory to the clients?
To assist you in finalizing your decision in acquiring the services of your financial advisor, try to ask what clients have worked with him or her before. Hopefully, testimonials can be provided and this will also give you some idea about the working style of this advisor.
Probably, the most important question to ask is if you can get all of this in writing. Having that written document gives you a basis for what services will be delivered by your chosen financial advisor. Finding the right fit will be challenging but putting your financial affairs in order is serious business and the effort will be well worth it.
