How to hire Financial Advisors
Our investment, tax and legal world is complex. As your financial life grows, a good advisory team should enable you to clarify goals, deal with change and monitor progress to enable money to empower you. Your reward from good financial advice should more than pay for the compensation paid for services.
Even if you have a working knowledge of financial issues, as you become busier and more affluent, a good team should become a strong ally in your financial life. As you go through transitions…inheriting money, divorce, job changes, retirement preparation, etc. Relying on a good team should you help get better results, increase confidence, and save time and energy. You may also need to re-evaluate your advisors if they fail to live up to your expectations or go into their own retirement without communicating a satisfactory succession plan to serve your needs.
Finding good advisors may be challenging. You may go to friends for referrals, but how do you know they went through good process to pick their team…but a referral is a good starting point. Look in your community for advisors that have prominent roles in community activities and philanthropy. Advertising and social media may identify names…but you still have to do your home work.
Below we will lay out three broad topics for you to investigate: Transparency. Experience. Compensation.
- A good advisor should be open and transparent so you can have a good conversation to see if the advisory team is in alignment with you and what you want to accomplish.
- Here are a few good questions:
- Tell me about you and your firm?
- How many professional staff are available to work with us?
- With whom do you consult when complex issues arise?
- Who are your typical clients?
- What is the size of your average client?
- Are you independent?
- Describe any conflicts of interest.
- What is your service package for a relationship our size?
- How and when did you get into this business?
- What is your education background?
- What professional designations do you have?
- What are the continuing education requirements?
- Are you a fiduciary?
- What licenses do you have and who does your compliance?
- May I interview a few clients for references?
- How will I compensate you for your services?
- What is an all-in cost structure for a relationship of our size?
- Fees, commissions, fund expenses, transaction costs, etc.
- Is your compensation tiered to allow for a reduction as we grow?
Monitoring our results
Building and maintain your advisory team is a constant process of good communication and accountability. You have heard the old adage…trust but verify.
As you go through stable times, volatile times and life transitions, communicate with your team, monitor your progress and re-evaluate and make changes as necessary.
Best of luck with the process! Please let us know how we may help.