7 Questions to Ask a Financial Advisor

 7 Questions to Ask a Financial Advisor

If you’ve already decided to hire a financial advisor to help you manage your money, make sure you’re hiring the most qualified, experienced professional you can find. There are countless financial advisors out there so how will you be able to choose the best one for you?

By asking these 7 questions. Interviewing financial advisors can be uncomfortable if you don’t know what to ask. 

Take a look at our list of questions to help you with your selection process.

What Is Included In Your Services?

You should start the interview by asking what is included in their financial services. This will give you a clear picture of what you can expect from a potential advisor. For example, do you seek general financial planning services involving all areas or are you more interested in retirement planning or estate planning? 

This is because not all financial advisors provide the same set of services. It is important to know what services they provide to see whether they’re a good match. If you seek full financial planning services, it might be a good idea to check out a financial planning firm such as Opes Fidelio in Ireland

Are You a Fiduciary?

Advisors can be divided into two groups: fiduciary and non-fiduciary. These terms may be confusing to those unfamiliar with them, so we’ll simplify it: a fiduciary financial advisor is obliged to act in your best interest whereas non-fiduciary is not. 

Not all financial advisors are fiduciary, therefore, you should ask this question as soon as you start the interview. If an advisor is a fiduciary, that means they will always have your best interest in mind. They won’t mislead you or use your assets for their own gain.

If you’re hiring a financial professional to help you manage your finances, you definitely want this type of advisor. 

What Are Your Qualifications/Credentials?

There are too many incompetent financial professionals out there with questionable qualifications so you have to be careful in your selection process. Ask them what their credentials and qualifications are. 

Have they obtained a Certified Financial Planner (CFP) certificate? If yes, then you know they have passed an extensive examination and are prepared to work with clients. 

Other highly-regarded credentials include Chartered Financial Analyst (CFA) and Personal Financial Specialist (PFS).

How Are You Paid?

One of the most important questions to ask a financial advisor you’re interviewing concerns their fee. How much will it cost you to hire them? 

Financial advisors are paid differently, depending on the type of services they provide. Some may charge a flat fee, an hourly fee, or a percentage of the assets they manage (usually 1%)?

We recommend that you choose a fee-only financial advisor so make sure you don’t skip this question. It will also help you determine whether you can afford to hire a particular financial advisor or not. If the fee exceeds your financial abilities, keep interviewing other candidates.

Do You Receive Commissions?

You may naively think that all financial advisors will give you the best possible, honest advice concerning your money. Unfortunately, this is not the case. 

Financial advisors who receive commissions are a bit conflicted because they are driven to push you in a certain direction. They receive a commission every time they sell a product or investment so they might not necessarily act in your best interest. They may advise you to invest in something merely because they would receive a high commission instead of recommending the best, low-risk option for you.

If the advisor you’re interviewing receives commissions, this might not be the best choice for you.

Do You Have Adequate Experience?

Needless to say, you’d want your financial advisor to be experienced in working with similar clients. This is why one of the first questions you ask should be this. Check whether they have experience with your industry. Don’t be afraid to ask about their previous clients. 

After all, it’s your money and you have the right to know what you’re getting for the service you pay. 

If they’ve already worked with similar clients, they’ll know how to guide you through everything.

What is Your Investment Approach?

Another important question to ask. If you’re seeking professional guidance for your investments, you should be able to understand their approach and investment philosophy. Avoid shady advisors with a complex investment plan that you can’t understand. It’s your money and you should know where it goes. 

That is why you need a financial advisor who is patient with their clients and a great communicator. 


Paul diverson