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How to Choose a Financial Advisor

What does a Financial Advisor do?

A Financial Advisor is an experienced professional who can evaluate your aspirations and financial needs and goals, and help you decide on investments and insurance, and be aware of tax considerations. An advisor can also help you determine what kind of investor you are and how much guidance you might need.

Choosing a Financial Advisor

Ideally, your Financial Advisor should be someone you like and trust. More importantly, your advisor should be someone who makes you feel comfortable when discussing your finances. Here are 5 steps to finding an advisor who’s right for you:

  1. Ask people you trust to help you develop a list. Start your search by asking family, friends, colleagues, and professionals you respect for their recommendations. Narrow your list to about 4 or 5 potential Financial Advisors who you’ll research further.
  2. Research the names on your list. A good place to start is BrokerCheck, a free online tool offered by the Financial Industry Regulatory Authority (FINRA). Use it to look up an advisor’s employment history, registrations, and more. Company websites also will offer information such as advisor bios and service offerings. FINRA provides a helpful list of professional designations that can help you understand the letters that appear after an advisor’s name.
  3. Look beyond their credentials. Find an advisor who will thoroughly evaluate your goals and financial situation, and who plans to adjust your investments as your needs change. Also, consider the cost structure you’re comfortable with; advisors typically get paid based on a percentage of the assets they manage, or from commission or hourly billing — or a combination of all 3 methods.
  4. Meet face to face if you can. Some things to look for include the advisor’s ability to communicate, listen, and show that he or she truly cares about you. Basic interview questions can give you insight into a Financial Advisor’s approach and your comfort level with it. Before your meeting, review and print these questions to ask a Financial Advisor.
  5. Consider your perceptions. After you meet with potential advisors, reflect on your interaction.
    • Did the advisor show a genuine interest in answering all of your questions?
    • Was the conversation respectful and balanced, or did you feel the advisor did more talking than listening? If you and your spouse or partner met with the advisor, did the advisor speak to both of you, or just one?

 Check their credentials 

BrokerCheck provides an advisor’s employment history, registrations, and more.

Considering working with an advisor?