How to Choose a Financial Advisor

Choosing a Financial Advisor can be a scary thought, especially if you are not a financial expert. In fact, choosing a financial advisor is enough to make you want to have a drink! It can be much easier however, if you ask the financial advisor questions listed below.


 Investing Can Make You Want to Drink!




What should I look for when choosing a financial advisor you ask? Keep reading below to find the answers!

How to Choose a financial Advisor Step 1: Find out your financial advisor’s background 

Is your Pro really a pro…or is your pro in the middle of a recent career change. This is your LIFE SAVINGS and in some cases it took 40 years to amass your wealth; you shouldn’t take this decision lightly and you shouldn’t be afraid to ask any question that pops into your head. Make sure you are working with a real financial expert!  Look for a financial expert with real trading experience which is not necessarily a CFP or a fee only financial advisor.


  • Most financial advisors are professional sales people (fee only financial advisors included)
  • They know a lot about the things they should say to you to make you want to buy or stay
  • They know a lot about how to wine and dine you at their seminars and client appreciation events
  • They know a lot about how to find solutions that work in the short term
  • Choosing a Financial Advisor that meets your needs requires you to see past the fluff
  • Very few of them have a plan for tanking bond values when interest rates rise
  • Very few of them have a plan if another flash crash occurs and the market drops 10% in a day and
  • Very few of them created wealth from investing!
  • Make sure your advisor is registered visit the SEC website for an easy broker check (we can help you navigate the site just fill in your information below and we can call or email you).

Should you ask a fee only financial advisor the same question as a retirement income specialist who sells mostly annuities? 

What is the difference between fee only financial planning and a fee only financial advisor?

Why can’t you find the fees you are paying your advisor on your monthly statement?

A few paragraphs below we will provide an arsenal of financial advisor questions and important resources to help you better prepare when choosing a Financial Advisor (or choosing to leave/stay).  These financial advisor questions must be asked at your next appointment!

How to Choose a Financial Advisor Step 2: Determine the type of Advisor you are working with 

Which financial expert are you with (considering):

  • Fee Only Financial Advisor
  • Fee Only Financial Planning Expert
  • Retirement Income Specialist (see more on this term below)
  • Broker who charges all of the above fees plus commissions
  • Broker who only charges commissions
  • Broker at a Big Firm
  • Broker at an Independent Small to Mid-Size Firm
  • Broker at a Small Firm

How to Choose a Financial Advisor Step 3: Ask the Tough Questions

The following financial advisor questions could save you thousands if not millions of dollars (not to mention a headache you didn’t plan on).  If you have or are choosing a financial advisor put these questions in your pocket during your next appointment.  

These financial advisor questions will guide you to a financial advisor with a brain instead of the gift of gab! 

Feel empowered when sitting with a so called financial expert! 

Listed below are several Financial Advisor Questions that YOU MUST ask before you invest or (continue working with them):

  • How long have you been a financial advisor?
  • What was your background before you became a financial advisor?
  • How Much Will You Get Paid the Day My Money Arrives at your Firm? How much will your firm get paid?
  • What’s different about your strategy today vs. 2008/2009?  
  • If interest rates rise how much will my bond principal fluctuate?
  • Are bonds guaranteed?  
  • Do you charge commissions?
  • Do I pay Commissions?  How much will it cost me to buy 100 shares of a stock?
  • Do you charge an asset under management fee? How much per year and is it billed daily, monthly, or quarterly?
  • Are you a financial planner or just an investment advisor?
  • Do you have a financial planning fee?
  • Any products/investments you can’t offer due to restrictions from your compliance department (Insurance Only? Securities only? Are You an Independent advisor)?
  • Have you ever managed a portfolio besides your own where you actually picked all of the stocks, bonds, ETF’s, and strategies on behalf of individuals or institutions? (If no) How do you know your asset managers are working in your client’s best interest if you haven’t been in an asset managers shoes before?
  • How much (in dollars) would my portfolio lose if the S&P 500 dropped 10, 20, 30, or even 50%? How much would my portfolio lose if the 10-year treasury increased to 5%? (If your advisor/prospective advisor can’t answer these questions I encourage you to seek advice from another professional).
  • If you have a basket of stocks, equity etf’s, equity mutual funds, or another equity equivalent ask your advisor how much you lost in 2008 through first quarter of 2009… the tech bubble?

Annuity Solicitation Warning:

Advisors claim to be “Retirement Income Specialist” usually push annuities and are often not securities licensed.

Annuities can serve a purpose in a retirement portfolio, but unfortunately it’s the only product many so called “advisors” can offer. Insurance companies that offer annuities often pay advisors a very “healthy commission” that can create a conflict of interest (7-10% of the amount you invest up front). You need to know “who” is offering your investment plan and make sure they aren’t selling you a product that’s in their best interest instead of yours.

If you like the answers an advisor gave you about your tough questions (and the others you ask) they will likely ask to take a peak at your existing plan. Let them. If they don’t like what they see, they will be happy to show you what they believe is a better solution for your investments. Some advisors will do this Free of charge while others will charge a financial planning fee ranging from $250-$10,000 depending on the complexity of your financial picture.

If you allow an advisor to present a solution to you, don’t decide right there and then that you want to proceed with the new plan. Think about the solutions and the unexpected impact they will have on your finances.

  • Does the new plan meet your objective?
  • Are the penalties (if any) for leaving your existing plan worth making a change?  
  • Will you pay taxes if you sell your current holdings?  
  • If you change your mind about your new plan, are the new investments liquid enough to move to someone else or will it cost you a large amount in penalties to switch?

How to choose a financial advisor shouldn’t be a scary thought.  Don’t let it consume you.Take your time.  Write down your goals. Take the questions in this blog to your next appointment, and don’t be afraid to ask them!

When visiting your financial advisor or the new team you are considering, don’t make your decision based on a hunch.  Use our questions about how to choose a financial advisor and you will be spending more time relaxing on the golf course and less time stressing out!


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