Sourcing a financial planner

When one thinks of their money and how it is managed, they often focus on one metric — how well it has performed in the financial market.

A recent survey reveals that another factor also determines if someone is satisfied with their investment firm: their financial advisor. The study points out that there are two factors beyond investment performance that separate firms with high levels of satisfaction from those with low satisfaction levels: the person who investors credit for the performance of their investments and the relationship they have with their advisor.

When it comes to our investments, how well our money does is out of our control — the past is not an indicator of the future. But who manages our money is in our control.

Here are some tips on how to find an investment advisor who is a good fit for your money needs.

How to Find the Right Investment Advisor

Start by asking your family and friends for referrals, says Boston-based Financial Advisor David Barcomb and, importantly, get recommendations from those whose financial needs, stage of life or outlook is akin to yours. Before setting up an interview with each planner, look them up online and on their LinkedIn to better understand what each firm is like. Sometimes something as simple as the images used on their websites can indicate the ones that target your demographic.

You can also search for a financial advisor directly on the websites of the NAPFA the National Association of Personal Financial Advisors or the Financial Planning Association. The advisors on the NAPFA site are fee-only, which mean they simply charge you a flat rate, usually based on the investments you put under management, rather than a commission on items that you buy. Many experts agree that a fee-only planner is the better option. It eliminates conflicts of interest and ensures they act with your best interest at heart.

Once you’ve created a list of potential advisors, be sure to find out if any have ever been disciplined for any unethical or unlawful behavior. You can find this information on the Financial Industry Regulatory Authority’s (FINRA) BrokerCheck. You can also review if the have CFP certification status on the CFP site.

Go into your interview with a list of prepared questions that will help you get a complete view of each financial advisor. A set of standard questions will give you consistency in each interview. Some questions can include:

  • What do you charge? And for what?
  • What licenses or certifications do you hold?
  • What type of clients do you specialize in?
  • What services do you and your firm offer?
  • Could I review a sample financial plan?
  • How much interaction do you have with clients?
  • What makes your service offering unique?

Coming prepared with questions like these will assist you in staying focused and finding the best financial advisor.

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