How to Find the Right Financial Advisor for You

How to Find the Right Financial Advisor for You

Finding the right financial advisor is a little like finding your soulmate—you won’t necessarily meet them on your first date, but that doesn’t mean he or she doesn’t exist. For some, the process can be intimidating and a little bit frustrating, so today I’m going to share some tips that will hopefully help you meet Mr or Mrs Right … Financial Advisor that is!

A, B, C … What Does Those Letters Behind Your Name Mean?

Financial advisor has become a bit of catch-all title for anyone who is licensed to sell investments. To distinguish themselves, many financial advisors have additional designations or credentials, so I am going to review the most common ones you will see.

Certified Financial Planner (CFP®)

The CFP® is one of the most respected financial planning designations and requires extensive training and experience requirements. A CFP® must follow a strict code of ethics and pass a lengthy examination (10 hour exam over two days with a 50% pass rate). These individuals understand the always evolving financial world and can provide a broad range of financial advice.

Chartered Financial Consultant (ChFC)

Frequently held by those in the insurance industry who specialize in some aspects of financial planning by meeting additional education requirements in estates, taxes and portfolio management.

Chartered Retirement Planning Counselor (CRPC®)

A Chartered Retirement Planning Counselor has pursued additional education on a variety of retirement principles and topics to help guide their clients through the retirement process from start to finish.

There are over 100 designations available, so this is just a small sampling of some of the designations your financial advisor may have. These alone do not make them better financial advisors but may be indicative of a desire to increase skill sets and better serve their clients.

What Does a Complimentary Financial Consultation Look Like?

The complimentary consultation is a bit like a first date. Both you and the financial advisor are trying to determine whether you are a good fit for one another and can have a happy, long-term relationship. While every financial advisor will conduct this meeting a bit differently, these four areas should be covered.

Your Chief Area(s) of Concern

In other words, what brought you here today. For most people, there is some sort of catalyst that led them to meet with a financial advisor. Share with them whatever that concern may be. You want to make sure they listen well and can help you address this concern.

PLEASE NOTE: Remember, this is a free consultation. Do not expect to receive specific, tailored advice to your individual situation at this point. The financial advisor doesn’t know your financial situation well enough to give you more than general advice. What you should expect is that your prospective financial advisor listens carefully and asks good questions, so they fully understand your concerns. Ultimately, you should feel they have the skills and knowledge to address your specific situation.

Your Financial Goals and Dreams

They should ask about your financial goals because knowing what matters most to you determines how we create your financial plan and investment strategy. Investments may also be discussed at this time, but a discussion around your goals should come first.

How We Work Together

Up to this point, you have probably been doing the majority of the talking with the advisor asking lots of questions to get a better grasp of your situation and needs. Now this is the time for them to shine. They should explain who they are, the services they offer, how they work with their clients, what you as a client can expect from them, who is on their team and how you will work with them, etc.

How I Get Paid

I intentionally kept this separate because it is such an important point and can make or break your relationship. Your advisor must be upfront and transparent with how they get paid. There should be no question in your mind. If you have questions or concerns, share them now. He or she should willingly and patiently answer your questions.

5 Questions to Help You Find the Right Financial Advisor

Most of these questions should be addressed by the financial advisor when they discuss how we can work together. But if they are not, then be sure to ask them before the meeting ends.

What Are Your Qualifications? Experience? Expertise?
You want to make sure the financial advisor has relevant experience to your situation and have the skills and knowledge to provide you with the information and guidance you need. They should share any designations they have and how they benefit you.

What Is Your Approach to Financial Planning? Your Investment Philosophy?
Do they take more of a holistic approach where financial planning and investments work hand-in hand? Or do they favor one over the other? If so, does that meet your needs? Ask them to walk you through how they choose which investments to recommend and why.

Have you ever been disciplined by a professional or regulatory governing body?
They should be forthcoming with you. You should also do your due diligence and check for disciplinary actions on FINRA’s broker check.

How Are You Compensated?
Hopefully, they tell you before you have to ask them. Again, make sure they are very clear on how they get paid and you are comfortable with how they are compensated.

Did He or She Seem Interested in Me?
This is the question you have to ask yourself after the meeting. Who did the most talking? You should have done the majority. They should have asked plenty of questions to understand your needs better and seemed interested and able to help you create the life you want for yourself. They should not have been offended by your questions, particularly around compensation. They should not be condescending or make your feel bad for past or current money mistakes. They shoot straight (i.e. not be a yes-man) yet still treat you respectfully.

The Right Financial Advisor Is Out There

I hope these tips will help you as you interview financial advisors. The right one is out there and can be a huge asset when it comes to creating the life you want for yourself and your family. I know from being both the financial advisor and client.


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April 23, 2014  •  18 Comments  •  Finance

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  1. Wednesday, April 23rd, 2014
    Very thorough post Shannon and thanks for sharing! Having been in the industry I know there are many designations out there and feel it's important to know what it is you're looking for when starting to look for an advisor. I love your questions as they're so important to ask - for both parties in order to make sure it's a good match for both.
    • Shannon Ryan
      Wednesday, April 23rd, 2014
      Thanks, John! Yes, there are quite a few designations and some carry more weight than others too. Money is very personal and intimate so you do want to take your time to find the right advisor and make sure it's a good match.
  2. Wednesday, April 23rd, 2014
    This is great info Shannon. I have someone I work with where I have an investment account, but sometimes I feel like I might need a personal cheerleader or someone who knows my lifestyle and what being a freelancer is like, to help better guide me.
    • Shannon Ryan
      Wednesday, April 23rd, 2014
      Absolutely, Tonya. Most financial advisors start out sort of like general practitioners and as they gain experience they tend to specialize a bit more. You definitely want to interview advisors who have plenty of experience working with freelancers and understand their needs, especially since your income can vary greatly from month to month. Ask them how they work with freelancers and common gaps and opportunities they see to give you a sense of their experience and ability to help you.
  3. Wednesday, April 23rd, 2014
    This seems like a great guide. I'm really liking this "series" of posts about financial planners. Thanks for sharing this great info Shannon.
    • Shannon Ryan
      Wednesday, April 23rd, 2014
      Thanks! I appreciate your kind words and I'm glad you found this series helpful! :)
  4. Wednesday, April 23rd, 2014
    Great points Shannon!!! And I would also add that you should probably meet with a few advisors so that you can compare and contrast. I know a number of people who just met one advisor and didn't want to go through the "dating" process and ended up miserable. There are lots of advisors out there and it is important that you take the time to find the best one for you.
    • Shannon Ryan
      Wednesday, April 23rd, 2014
      Absolutely, interview multiple advisors is a must. Even if you love the first financial advisor you meet, you should still sit-down with a couple more to make sure they are a good fit.
  5. Wednesday, April 23rd, 2014
    Thanks for sharing these insights Shannon. Hopefully, I'll accumulate enough wealth at some point to need a little assistance from a financial planner!
    • Shannon Ryan
      Wednesday, April 23rd, 2014
      You're welcome, Stefanie! I have no doubt that you will accumulate the wealth to meet with a financial advisor. And you don't need to be "wealthy" to work with a financial advisor either. :)
  6. Wednesday, April 23rd, 2014
    Hi Shannon!

    I love this, it's kind of like a cheat sheet...I'm definitely bookmarking this to use the questions when we decided on a financial advisor.

    I never knew there were different types of financial advisors. I always thought it was kind of a "one size fits all" but I learned something new here as well :)

    Thanks for putting this post together! Happy Hump Day to ya!
    • Shannon Ryan
      Wednesday, April 23rd, 2014
      You're welcome, Corina! I definitely want to help people feel more comfortable setting up a meeting with a financial advisor. Sometimes the unknown can prevent people from seeking help, so I wanted to let them know what they should expect to happen and what the financial advisor should address.
  7. Wednesday, April 23rd, 2014
    Great tips Shannon, thank you for sharing :) But I bet YOU are the best financial planner in the universe!!
    • Shannon Ryan
      Wednesday, April 23rd, 2014
      Awwww….Mackenize. You are so sweet! And made my day. :)
  8. Thursday, April 24th, 2014
    I've never used a financial advisor, and I doubt that I ever will. Our new next-door-neighbor is a flashy financial advisor, though. I keep waiting for him to hit me up! Haha!
  9. Sunday, April 27th, 2014
    Shannon - we went looking for a new financial advisor because our previous investment manager left the firm and we didn't feel like we were getting the type of focus we needed from him anyways. We found a guy we liked, but he could only trade in mutual funds, but I prefer to have my portfolio in dividend stocks. So we ended up staying where we are with the guy who took over from our previous one, but I'm also comme ci comme ça about this guy. He is making us a lot of money in the stock market and he did pay for a retirement planner in the firm to do a complete review of our goals and retirement timeline, and will do so again when we request it. But we are paying a lot of fees, so it should be expected.

    I would like to make a move to handling my own investments and working with a fee only advisor. I would hope the payback would be worth it. I'm just a little nervous about taking that on myself.
  10. Sunday, April 27th, 2014
    That's a good point about how the advisor gets paid. I've never had anyone tell me that and when asked, they kind of skirted around the issue. I think that was a huge red flag for me and one reason I've never actually used an advisor.
  11. Sunday, April 27th, 2014
    These are great tips and questions to ask, thanks Shannon! I actually didn't know there were other titles other than CFP, so that was good to know. I think it would be really helpful to help plan our 5, 10, 20, and beyond year goals!
  • Meet Shannon

    "As a Certified Financial Planner, it is my passion to help individuals and families build a healthy relationship with money. I look forward to helping you raise financially confident kids.” - Shannon Ryan