Which Financial Advisor Is Right for You

10 March, 2017

The most basic of questions are sometimes not asked by a lot of consumers of financial and investment planning services who are on the lookout for their specific needs and financial goals. By knowing what the right questions to ask, you will be able to effectively find the right financial advisor instead of being influenced by advertising, posh offices and hollow promises.

Blame the big budget of financial institutions in Wall Street. Their marketing campaigns allowed the evolution of sales people to become “Financial Consultants” or “Vice President of Investments” whereas they’re just sale people, no more, no less.

For this reason when going down this path, checking your financial advisors background, credentials, philosophy, compensation and experience in the financial services industry can quickly weed out the “less professional” financial advisors.

One of the most important “qualifiers” is their level of experience in serving client’s financial needs and helping them accomplishing their goals. Keep in mind, I didn’t say “length of experience in the business”. Just because someone may have 20 years of experience which may include years of nothing remotely related to serving clients financial needs.

To choose the right financial advisor, focus on asking the right questions, and expect thorough answers:

As a financial advisor, how many years of training did he had?

What firms have you worked for in the capacity of a financial advisor?

How many financial plans has he created for clients?

Years working directly with clients as their primary financial advisor.

How long has been suggesting investment and insurance products?

Years of actively and consistently creating financial plans to achieve client’s financial objectives.

What is his training background, where did he learn to analyze, manage and solve the financial woes of clients?

But just what should their answers entail? In terms of acceptable financial experience, I would argue the following:

Has at least 3 years’ worth of experience.

A college degree–a new requirement for NAPFA (National Association of Personal Financial Advisors, NAPFA.org) registered financial advisors.

A CERTIFIED FINANCIAL PLANNER(TM) (CFP(R)) or Chartered Financial Consultant(R) (ChFC(R)) designation. Both credentials show substantial dedication to being among the best in the financial services field.

At least 20 written financial plans to gauge how extensive their knowledge and experience is. Take your time in interviewing each candidate. Require and expect thorough and straight answers from them. This way, you’ll be able to see who among them will be able to deliver excellent and sound financial advise.

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