Questions to Ask When Looking for a Personal Financial Planner

Questions to Ask When Looking for a Personal Financial Planner

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What are your plans for the future? What goals do you have for your money? If you’re ready to make your big dreams come true, it might be time to find a personal financial planner.

Navigating today’s complex financial markets requires more than an app or an online account. It takes a deep understanding of your lifestyle and money, along with a grasp of how they’ll meet in the middle.

That’s where a personal relationship with a financial planner can help you. The right one can provide you with expertise along with sound judgment. They can be just who you need to guide you into the future while increasing your financial savviness.

But how do you find that person? These questions can help.

Are you a fiduciary?

A fiduciary takes care of money or other assets on behalf of another person. They are advisors who must act in your best interest. A fiduciary will never recommend products or investments solely for the compensation they’ll earn from the sale. Instead, they advise their clients based on what’s best for their portfolio. Not all financial planners are fiduciaries.

How do you get paid?

Financial planners can be paid in many ways:

  • A percentage of the assets they manage
  • Commissions for products sold
  • A flat fee for services
  • An hourly fee

Knowing this upfront helps you understand what it will cost you to work with this planner, knowing if you’ll pay for every meeting or if they have the incentive to sell you financial products.

What are your qualifications?

When looking for a financial planner, the titles and acronyms behind their names can be quite confusing. No matter what title or designation they use, it’s up to you to vet their credentials. You can start by verifying their registration information through BrokerCheck, a free resource through the Financial Industry Regulatory Authority. Or verify a Certified Financial Planner (CFP) certification through the CFP Board. Each board or certification has its own verification tools. Do your due diligence to ensure you are comfortable with their background.

What is your investment philosophy?

This is a relationship you hope to carry forward many years into the future. Just as you would interview a doctor or a therapist to ensure they are a good fit, don’t be afraid to dig deep into their strengths and how they approach their investment strategy. You’ll be relying on their advice through good times and bad. It’s essential to believe in their overall approach if you are going to stick with it long-term. It’s that belief that will hold strong no matter if the market is up or down. A strong relationship should be as much about trust as it is about assuring they align with your values.

What is your specialty?

Many financial planners keep an open practice and help many within their community. Others prefer specializing in getting really good at a specialty. It’s not uncommon to find planners who work exclusively with:

  • Small business owners
  • Women a few years from retirement
  • High-end retirees
  • Growing families

It’s helpful to find a personal financial planner with experience working with people just like you. They understand your situation better and often have a more thorough understanding of your goals and desires.

How much contact do you have with your clients?

Some financial planners have an initial planning meeting and then meet once per year to review goals. Others prefer more regular check-ins, touching base once per month. How does this fit with your philosophy? Do you like more hand-holding? Do you want your questions answered and prefer a direct approach? There isn’t a wrong or right way, but it is a good idea to understand how your advisor works before you start investing.

Will I be working with you or a team?

This gives you a good benchmark for your financial planner’s team size. Will you connect directly with your advisor whenever you have a question? Or will you be working with other team members from time to time? There isn’t a right or wrong approach, but it can help you get a better feel for the team you’ll be working with.

What about your client experience?

A potential financial planner should be able to answer the question: Why should I work with you? This gives them a chance to tell you about their strengths and make a pitch on how they can help you maximize returns and meet your goals. This is about growing your nest egg in the manner you prefer. Does this prospect feel like a good fit for you? Can you see yourself working with them for the long term?

Who should you choose?

As you’re finalizing your decision, ask yourself these important final questions. Selecting a personal financial planner should be about your gut feeling. Pay attention to how a prospect talks with you: Do they ask questions and listen to your response? Do they use your input to change their approach? While their core strategy should never change, they should do a good job listening to your desires and customizing their plans.

If you feel good about your selection, it’s time to say: You’re hired.