9 Tips For Choosing The Perfect Financial Advisor


Working with a good financial advisor is the key to managing your portfolio, creating financial goals, and ensuring you are on the right track for retirement.

However, it can often be difficult to choose as there seems to be a financial advisor around every corner. If you’re looking for the perfect match, keep the following tips in mind.

Be Aware of the Differences

Not all financial advisors are created equal. Some are commission-based, meaning they make money whenever they buy or sell certain products for you.

Others are advice or fee-based, meaning they make a certain amount from each client and do not make more depending on what they sell.

In most cases, you’re better off with a fee-based advisor as they have no ulterior motives to sell you products you don’t need.

Decide How Often You Need to Talk to Your Advisor

If you enjoy meeting with your advisor on a regular basis to go over life changes, fluctuations in the market, or just to learn more about your investment strategy, you’re probably better off with a fee-based advisor located in the city where you live.

However, if you only want to talk to your advisor when you need to open an account or make a trade, you can consider those who are commission-based or who conduct most of their business via Skype or over the phone.

Keep Personality in Mind

Even the most knowledgeable and professional financial advisor won’t be a good fit for you if your personalities don’t mesh. The best way to ensure a good fit is to schedule an initial meeting with your potential advisor. Have a conversation that brings in both personal and business matters and gauge how you feel around them.

Do they seem to ‘get’ you? Are there any mannerisms that rub you the wrong way? Do they really listen to what you have to say? Do you have the same sense of humor? Getting along with your advisor will make for a more beneficial and enjoyable relationship as you move forward.

Focus on Customer Service

Whether you need to speak to your advisor once every few weeks or once a year, they should be responsive to your calls and always make time to help you.

It may be tough to determine their level of customer service in the beginning stages of the relationship, but you can usually test them out by asking a few questions or leaving some messages and seeing how long it takes them to get back to you.

Make Sure You Speak the Same Language

If your financial planner uses a lot of jargon and big words you don’t understand, you may feel patronized and unable to communicate.

Your planner should always make sure they are communicating in the way that works best for you. This means learning whether you learn best through discussions in-person, via email, or on the phone as well as when to push you — and when to back off.

Find Out About Ongoing Training

The financial industry is constantly in flux. If your advisor isn’t regularly attending seminars and training events or getting ongoing education online, he or she is likely to be behind the times.

Feel free to ask your potential advisor about any certifications they have, upcoming training plans, and how they stay up-to-date on their industry.

Make Sure You’re Comfortable with the Tech They Use

Financial advisors vary widely when it comes to the technology they use.

Some use the bare minimum and still rely on in-person meetings and phone calls, while others have highly advanced systems their clients can use to do a lot of the work themselves.

Find out where your comfort level lies on this scale and ensure your financial advisor’s tech style fits well with that.

Ask for References

You can learn a lot by talking with a financial advisor’s former or current clients. You should feel comfortable asking a potential advisor for a list of people you can call and if they seem hesitant, consider it a red flag.

Once you get the references, have pre-determined questions to ask each person determined by what you feel are the most important qualities in a financial advisor.

Ensure You Work with a Fiduciary

Financial advisors should always have your best interests in the forefront at all times. If they have taken the pledge to always act this way, this means they are a fiduciary. Fiduciaries are held to high standards and must prove that the decisions they help you make are furthering your personal goals. If your planner is not a fiduciary, you may want to look for a different advisor.

Of all the professional relationships you form in your life, the one you have with your financial advisor is arguably one of the most important. Use the above nine tips to ensure you choose the best one for your needs.