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How to Select a Financial Advisor

By Edited Nov 12, 2016 0 0

Financial planning is an important aspect of a money management strategy. Those who having savings to invest but are uncomfortable making independent investment decisions should consider working with a certified Financial Advisor. The choices though can be overwhelming and because you need to have a good relationship with your planner it is important to take due care in selecting one. This article will outline some of the important things to think about when finding and evaluating a Financial Advisor to work with.

Things You Will Need

Selecting a Financial Advisor
The first thing to do is decide on a short list of planners to evaluate. Common ways to find a planner can include referrals from friends, the phone book, professional association referrals (e.g. Insurance Broker) or contacting financial institutions. Once you have a list of planners to evaluate, you should set-up appointments to meet with them and consider the following steps by which to evaluate them:

Step 1

Find out if financial planning is their primary activity or is it just one of their activities.

Step 2

Find out if they are licensed.

Step 3

Ask about their education and formal training.

Step 4

Find out what their areas of expertise are.

Step 5

Find out if they work with other experts such as accountants, insurance brokers etc.

Step 6

How do they make their money? Are they fee based or commission based.

Step 7

Find out if they have any references they can give you.

Step 8

Ask to see a sample of the contract they use with clients.

Step 9

Ask to see a sample of a financial plan they have created.

Step 10

Ask yourself if you have a good feeling about them. Step 10 is one of the most important steps. The person you select are going to need a close working relationship. You will need to be honest with each other in order to achieve the best result of future financial goals and you need to enjoy working on this important aspect of your financial future.

Tips & Warnings

Not all Financial Advisors are as honest as they should be. Some will not disclose all the information they should and others may be driven to sell you products you don't need as they will get a commission. Think carefully about selecting a fee based planner. You need to pay for each session you meet with them but you can feel more confident that any decisions they make are not based on potential commission but based on doing the best job for you.
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