Justina R. Welch, MBA, CFP® | Clint P. Thomas, MSF, CFP®
When you put your money in the hands of a financial planner, you are trusting them to make decisions that will have a huge impact on your future wealth. That’s why it’s so important to choose your financial planner carefully.
What do you need to ask to ensure you’ll end up with a planner who will serve your interests above theirs? How do you make certain that you hire someone who is trustworthy and transparent about the fee they will charge you? Here are a few of the best questions to ask when making this important decision.
Are they a CERTIFIED FINANCIAL PLANNERTM Professional?
This may seem like a no-brainer, but one of the first things you should find out is if a financial planner is certified. Many advisors hold themselves out to be financial planners however many have not gone through the higher level of training to earn the respected CFP® designation.
Financial planners who are CERTIFIED FINANCIAL PLANNERTM professionals or also known as a CFP®, have completed the CFP® certification process, administered by CFP Board, and have met rigorous professional standards and have agreed to adhere to the principles of integrity, objectivity, competence, fairness, confidentiality, professionalism, and diligence when dealing with clients.
The certification shows that they have a higher level of commitment and will be better equipped to work with you and manage your assets.
Are they a fiduciary?
CERTIFIED FINANCIAL PLANNERTM professionals are required to be fiduciaries, if providing personalized financial advice. That not only means that they are required to put the clients’ interests above their own but also have a duty of loyalty and care by avoiding or disclosing potential conflicts of interests.
Unfortunately, some advisors do not have the same fiduciary responsibilities. Before working with an advisor or planner, ask if they are a fiduciary and how they put your interests first.
Are they independent?
When you choose a financial planner, you want someone with complete objectivity. For example, if an advisor works for an insurance based company, the advisor often gets paid when they sell a product such as an annuity, life insurance, or a commissionable mutual fund. As such, they may choose to sell you those products even though they might not be the best choice for you.
Integrity Wealth Solutions is an independent registered investment advisory firm, which means we offer independent, unbiased advice and solutions that our clients deserve.
Are they transparent about their fees?
Most advisors are not transparent about their fee structures. Often, they won’t give you concrete numbers and a good majority do not put their fee schedules clearly on their websites. Some indicate their fees are dependent on the complexity of your portfolio, which often means you won’t know what they charge until you meet with them, and that they can charge you whatever they choose.
Other advisors who sell a product and earn a commission, it is difficult to find out how much they are being compensated, unless they tell you outright. Trust your gut. If you feel that a planner isn’t being honest or transparent about their fees, find a company that can clearly articulate their advisory fees and are transparent with all other costs such as trading fees, investment expenses, account fees, etc.
Do they work holistically?
A financial planner who works holistically will spend time listening to your desires, dreams, objectives, and passions so the planner’s recommendations align with your goals. This integrated approach encompasses your entire financial picture and ensures all the different pieces of your financial puzzle are working together. A holistic financial planner will incorporate how your investment portfolio fits in with your retirement goals, evaluate your insurance needs, assess tax planning strategies, and confirm an appropriate estate plan is in place. In addition, a holistic financial planner will often work with your team of professionals, ranging from certified public accountants to estate attorneys, to coordinate your plan with your long-term goals.
How much experience do they have?
You want to work with a financial planner who has been through the ups and downs of the market for a longer time, and can guide you through the challenging times. If an advisor hasn’t been in the industry for very long, or has only seen times of prosperity, they won’t have the experience to be able to guide you through the emotional turmoil that changes in the market can bring. They may be reactionary, when what you really need is someone who will weather the storm with you and help keep you focused on your long-term goals.
Are you looking for a financial planner?
We know that hiring a financial planner is a big decision and it’s important to find someone that takes time to listen to your specific needs and goals. As CFPs®, we are passionate about YOU, the client, and helping you build your wealth story. Contact us to learn more about working together.
