With the recent trends in the financial markets, there’s an increasing demand for working with financial professionals. As the demand grows, we’re seeing a significant number of people who had subpar experiences working with someone who they thought was a good fit. We dedicated this episode to reviewing a few questions you can ask prospective financial advisors to make sure they are capable, qualified, and trustworthy.
Show Notes
[02:14] Background – Grant talks about the conversation that led to today’s topic and why it’s essential to be cautious when you’re looking for a financial advisor.
[07:19] Compensation – Different ways financial advisors get compensated and how the method of compensation affects the service provided by a financial advisor.
[14:08] Referral Fees – It’s a fairly common practice for financial advisors to take referral fees when they refer you to other professionals. Grant explains why you should know whether your financial advisor gets paid for referrals.
[15:32] Fiduciary Standard – How to find out whether your prospective financial advisor has a legal obligation to act in your best interest at all times.
[19:11] Fiduciary Oath – Confirming that your financial advisor will act in your best interest at all times.
[20:20] Regulations – How to check whether your potential financial advisor is disciplined by state regulators.
[22:17] Comprehensive Financial Planning – Some financial advisors help you make decisions surrounding the entire scope of your financial household, while others may only help you manage your investments. Grant explains how to figure out the scope of your financial advisor.
[25:07] Is This a Good Fit? – Other means of deciding whether your prospective financial advisor is capable of helping you.
[27:08] Business Continuity – What happens in case of a sudden absence of your financial advisor.
[29:07] Assessing Experience – Professional qualifications you can use to assess the experience of a financial advisor.
[32:43] Finding the Best Match for You - Tips for making sure your prospective financial advisor is a good fit for your needs.
Resources
Investment Adviser Public Disclosure (IAPD): adviserinfo.sec.gov
Regulation of Investment Advisers - Securities & Exchange Commission: sec.gov
What You Need to Know About Financial Planners – FINRA: finra.org