How to Select a Financial Advisor

Are you looking for a financial advisor (e.g., financial planner, counselor, or coach)? Here are some questions to ask according to the Association for Financial Counseling and Planning Education (AFCPE):

  • What experience do you have? Ask for a brief description of financial professionals’ work experience and how it relates to their current practice.
     
  • Is there an oversight body requiring ongoing education and ethics? Ask about the credentials that a professional holds and how he or she stays up to date with changes in the personal finance field.
     
  • What services do you provide? Asks about credentials, licenses, and areas of expertise that determine the services a financial professional can offer.
     
  • What is your approach? Make sure a professional’s philosophy and approach aligns with your needs. Also consider a financial professional’s personality, communication style, and personal compatibility. 
     
  • What types of clients do you typically work with? Some financial professionals prefer to work with clients whose assets fall within a particular range or are of a certain age (e.g., young adults).
     
  • How much do you charge?  A financial advisor should provide an estimate of possible costs based on the work to be performed and the compensation method that is used.
     
  • How will I pay for your services? Financial professionals can be paid in several ways (e.g., salary, flat fees, assets under management fees, commissions). Details should be included in a written agreement.
     
  • Do others stand to gain from the financial advice you give me? Ask the professional to provide you with a description of any conflicts of interest in writing.

More information about hiring financial advisors and questions to ask can be found in Unit 10 of the Cooperative Extension Investing For Your Future course.