Contributed by Sofie T.
It is important to ask the right kinds of questions when looking for a financial advisor. You want to be sure to have proof of their credibility and skill level. Here are a few questions that will help you determine if the advisor you are considering should be handling your financial affairs.
What are their education credentials? You want to be sure that they are a Certified Financial Planner (CFP). This certification means they had to pass a test and commit to continuous financial and ethical training. You should also check with the National Association of Personal Financial Advisors to be sure their credentials are current.
What is their fee structure? Advisers are typically paid on commission, by the hour, or, a flat fee. Since commissions are paid every time a stock is bought or sold, a commission-paid advisor may not be the most unbiased source of advice as they may promote investments that are in their best interest. A flat fee may be pre-determined fee for the whole plan or 1% of your assets on a yearly basis.
What is their ethics policy? The ethics policy should include the word, ‘fiduciary.’ This means the financial planner agrees to put your best interest first.
What is their background? Have they ever been convicted of a crime? Has any regulatory group even put them under investigation? Were they found responsible or guilty?
Do they have relevant experience? If you have kids and are primarily interested in building a college savings plan, make sure they have experience with these types of savings plan? If you are self-employed or are interested in green investing or have limited resources to devote to investing, make sure they are able to advise you about the best options for your particular needs or interests.
Hopefully these questions will make finding a financial planner easy. And, if there are other questions that you have used, let our soul mates know.
Views and Reviews