One of the most important things you can do to move toward a flourishing financial life is to build a relationship with a trusted financial advisor. The relationship between a client and an advisor can last for a lifetime, sometimes extending to a second or third generation. This is why your decision to choose an advisor should not be taken lightly but should be a thoughtful process.
I always tell potential clients to think of your financial advisor as you would your doctor. Having a good relationship is the first step. Just like your doctor, your advisor should listen to your concerns and struggles and then work with you to formulate a plan that addresses your needs. Maybe not right away, but at some point, you may need to confide personal or medical information with your advisor. Often clients will share information so personal that it hasn’t even been shared with their closest loved ones. Trusting your advisor as a confidant as well as an investment manager, is invaluable to the success of your financial plan. When you can share openly, unashamedly and without judgement your overall financial confidence will increase.
Careful consideration should be given to your advisor’s core values and beliefs. Although it is not necessary that your values and beliefs completely align, it is important to know that your advisor can act and make recommendations objectively.
One of the greatest benefits of working with a financial advisor is their ability to plan without emotion. This does not mean that they should be emotionless in their relationship with you, their client, but they should be able to plan without the influence of their own emotions affecting their recommendations. Being able to separate their own emotions from yours is what gives an advisor the ability to guide you in times of market fluctuations, economic downturns, or personal struggles.
In addition to the relationship, consider these additional steps to help you find the right advisor for you.
1. Research the potential advisor on FINRA’s Broker Check website and the CFP® website.
Broker Check shows the advisor’s profile containing information such as licensure, examinations passed, and previous employment. Additionally, you can see any complaints that have been reported against the advisor.
If your advisor is a CFP® professional, they will be listed on the CFP website site. A CFP® professional has committed to high ethical standards, has acquired several years of experience relating to financial planning services and has passed the comprehensive CFP® Certification Exam.
2. Don’t be afraid to ask questions when interviewing potential advisors. Here are a few questions I recommend:
How are you paid?
Find out how your financial advisor earns their income.
What fees should I expect to pay?
Be sure to understand how fees are assessed for all the services available to you.
What’s your background and training?
Ask questions about your advisor’s credentials, training, and background.
Are you a fiduciary?
A fiduciary is an individual who always puts the financial needs of their clients above their own.
What’s your working style?
Get a sense of how the advisor works, how often you will meet and what takes place during meetings.
By asking questions, researching an advisor’s background, and considering your needs in the professional relationship, you will narrow down your choices and start to move toward the financial professional that is right for you.
As you are moving toward a flourishing financial life, please feel free to send me your comments and questions. You can contact me directly at [email protected].
