Questions to Ask Your Financial Adviser

Many people are looking at their finances and wondering if maybe there is a better way to go about doing things. One way to help get on the right financial track and make a good plan is to consult with a financial adviser. While there is no full-proof way to get perfect finances, you can get help. Whether you are looking for a permanent financial adviser to help you manage your personal finances, or whether you just want to meet with a (fee-based) financial planner, there are some important questions to ask. Blain Reinkensmeyer at Stock Trading To Go offers these 7 questions to get answered before you commit to a financial adviser:

1. What is your background? It’s very important to know whether the adviser is more attuned to personal finances or corporate finances. And where was s/he certified?
2. What do clients say about you? Get references. Then try to find some clients on your own — that the adviser may not know you are asking.
3. How do you get paid? This is a very important question. You want to make sure that your adviser is up front about the way s/he is paid, and about where commissions are coming from. Hint: It’s better if most of the commissions come as a percentage of your portfolio performance or a flat fee.
4. Do you have checks and balances? What keeps your adviser from getting paid by companies to put you into something that may be good for your adviser, but not for you? Also, see that you are writing checks to third-parties and not directly to your adviser.
5. What is your track record? Look at the adviser’s long term and short term record — compare it to the performance of the market.
6. Will you put that in writing? Get the services the financial planner will provide — and the fees — in writing.
7. What do others think? Get a range of opinions from other professionals. This means that you need to have an idea of what your investments are, and what is going on with your finances.

Getting a financial adviser doesn’t relieve you of the responsibility of knowing what’s going on with your personal finances. But the first step to getting help with your finances is to make sure you do your research and your due diligence in terms of finding the right financial adviser.