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10 Questions to Ask a Financial Advisor: The Version We Like Thumbnail

10 Questions to Ask a Financial Advisor: The Version We Like

Financial Planning

So recently, I went to the inner webs regarding a project I was working on and typed in: "questions to ask a...". The second thing that came up "questions to ask a financial advisor". As I pondered a bit, I wondered why that is, considering all the things to ask in this world. But upon further reflection, I think it actually does make sense from a mass market perspective. The reality is, we are living in a world where we are all told we need to save for retirement, how much we need, how we should invest, etc. However, for many people, they do not know where to start or how the process works. We have this gap between knowing what we need to do, but we're not sure how to do it. Leave it to the world of information to try to fill that gap these days.

As I looked through the different selections that came up in the search, there were various lists of "top ten" questions to inquire about. While there were some good and thoughtful ones, it seemed many were heavily weighted in either fees or educational background areas. The top two seemed to be "how do you get paid?", or "are you a fiduciary?". These things are very important, but what I noticed as I went along is that there are not as many related to what we consider equally important; the items about values, relationships, etc.

At our firm, we know that the nuts-and-bolts questions need to be fully communicated as they relate to our long-term relationship. Things like how we get paid, education, experience, and financial planning expertise are crucial. However, we also know that engaging in true wealth management is the prerequisite for engagement, and there is so much more. Below is a pretty good top ten list from our behavioral finance relationship, Think2perform, modified just a bit. Thought we would share.

Top 10 Questions to Ask a Financial Advisor

  1. What are your most important values?
  2. What is the one thing your clients say most often about you?
  3. Can you tell me about a time when a client wanted to make a financial decision that you didn't think was in the client's best interest? How did you handle that?
  4. Please share a situation in which you made a mistake dealing with a client. How did you resolve the situation?
  5. Help me understand what an ongoing relationship with your practice looks like.
  6. What services do you personally provide that I might not expect from another advisor?
  7. How do you make sure your clients always make sure they know where they stand relative to their financial goals and life goals?
  8. Can you tell me about a situation in which you worked with another professional outside your firm to help meet a client's needs? Who do you work with and what was your relationship with him or her like?
  9. How have you personally responded to market volatility, and how have you communicated your thoughts and feelings about market volatility to clients?
  10. What kind of return can I expect if I asked you to manage my investments?

By the way, were you wondering what the first search result was? It was '10 Questions to ask in an interview'.

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