What to Ask a Financial Planner
The future is full of uncertainties, but finding the right financial planning partner can help you navigate whatever troubled waters lie ahead. For better or worse, there are an extraordinary variety of financial advisors and professionals, and all of them will want to convince you that your money is best spent on their services. Of course, you shouldn’t necessarily take every advisor at their word.
Instead, think carefully about what kind of relationship you want to have with the professional who helps you manage your finances—and get ready to interview your options. When you know what to ask a financial planner before you commit to a partnership, you’re practically guaranteed to enjoy a more satisfying and successful financial journey.
Do You Provide Comprehensive Financial Planning Services?
First things first: you should make sure that you’re dealing with someone who can assist with all areas of your financial wellbeing. Certain advisors may deal exclusively with investments or wealth management, while others offer a wider variety of services—including retirement planning, estate planning, and charitable giving strategies.
If you’re just looking to invest, there’s nothing wrong with choosing a wealth manager with a more limited purview. However, investment doesn’t take place in a vacuum. We think that most will be happier with a financial planner who understands your life in all of its complexity.
Are You a Fiduciary?
Financial professionals can be broadly divided into two categories: fiduciary and non-fiduciary. Non-fiduciary financial professionals, also known as brokers, may earn a commission based on the stocks that they include in your portfolio—and those purchases only have to be suitable for your current situation.
There’s often a world of difference between suitable investments and the best investments—and that’s why you should always choose to work with a fiduciary. Fiduciaries are required by law to act in their clients’ best interests, and they don’t earn commissions based on the recommendations that they make for your portfolio.
Beyond this, aim to get a deeper view of your financial planner’s past ventures, present commitments, and certifications. Brokercheck.Finra.com is the first place you should look.
How Do You Get Paid?
As a follow-up question, you should ensure that you’re working with a partner who exclusively earns money on the fees that you and other clients pay. Beyond this, continue to ask questions about the kind of fees that you’ll be paying. Flat fees, hourly rates, and percentage fees are all common. Many financial planners rely on some combination of these three sources of income.
Once you know what kind of fees you’ll be paying to the planner, you should aim to discern the total amount that you’ll pay over time. After all, advisor fees are most likely not the only fees that you’ll end up paying. (Ask about taxes too.)
Can You Support My Desire to Make an Impact?
We’ve already said that a good financial planner will try to take your entire situation into account. The best advisors know that money is just one part of the equation. If impact investing is important to you, you should know that some advisors and planners will be more willing to follow your guidelines than others.
Ask about the kind of control that you’ll have over your portfolio, and—if you can—find a financial planner who truly shares your values.
How Often Will We Be in Communication?
Some financial planners are happy to answer questions or make changes on the basis of calls or emails. Others will only want to work with you during scheduled meetings. An advisor who only gives you limited access to their time can still be a good advisor in certain circumstances. However, you need to ask yourself a few questions about what kind of relationship you want with your financial planner. Then, follow up with each potential planning partner to find the best fit for your unique needs.
How Will You Measure Success?
Ideally, you and your financial planner will work together to define “success”. However, you can gauge the competence and honesty of various financial planners by asking about the kind of benchmarks that they use to measure performance. Some benchmarks will be too easy to hit—and thus, you won’t be able to get a good idea of how well your investments are performing.
IntentGen Financial Partners: The Right Choice
These questions should be a starting point for your journey, but we certainly understand if you want to learn more before you commit to a partnership. Our articles on various financial topics are excellent resources, and you can always reach out to us for personalized advice and information.
Here at IntentGen Financial Partners, our planners and advisors are defined by our core values. If you’d like to work with a team that shares your goals and visions, we’d love to help you get started.