What Important Questions to Ask Financial Planners

Hiring a financial planner is a critical decision. You are after all trusting this person with your money and your financial future, so it’s vitally important to have confidence in the person you hire. Here are ten questions to ask potential financial planners.

1. What is your experience as a financial planner? Ask all prospective financial planners how long they have been practicing. You may also want to ask where they worked prior to the company they’re presently with.

2. What are your qualifications and certifications? “Financial Planner” can have more than one meaning. To help define what a financial planner can do for you, ask them what types of certifications or registrations they have. These might include CFP, RFP, CPA/PFS, ChFC, and CWM.

3. What services do you offer? The available services will depend largely on their certifications and licenses. For example, in order to sell insurance, they may be required to have a license in your state.

4. What is your approach or philosophy about financial planning? Financial planners are individuals with their own experiences, viewpoints and personality. While there will be some similarities in their educational backgrounds, as individuals they will bring different approaches to how they advise their clients. It’s important that their approach matches your goals and your personality and style.

One great way to broach the subject is to ask what types of clients they typically work with. If these clients mirror your own goals and lifestyle, it may be a good match.

5. Who else from your company will I be working with? Depending on the type of company the planner works for, they may have other people on your account. If this is the case, you may want to meet with those other people to make sure it’s a good match. And if your planner uses outside professionals, like an attorney, you may want to touch base with them too.

6. How much do you charge for your services? A financial planner should be able to provide you with a reliable estimate of how much they charge for their services.

7. How are you compensated? The way that you pay your financial planner should always be clear and it’s important to get all agreements in writing.

8. Have you ever been disciplined for unethical or unlawful behavior? Seems like a harsh question, right? Well, after the past few years and all the reports of advisors and planners gone awry, it’s important to make sure you’re hiring someone with ethics and integrity. And a reputable financial planner will have no problem answering this question.

If you’re uncomfortable asking, you can check with the various supervisory entities that govern the behavior of individuals in the financial services industry.

9. Can I get this in writing? Most financial planners will already be drawing up an agreement. If you have to ask, then it may be a red flag. At a minimum, the agreement will outline how they will be compensated and whether they will act as a fiduciary with your account.

10. What is the review process? Find out how you’re communicated with, how often you can expect a review and what their general policies and procedures are. Make sure you’re comfortable with them.

Hiring a financial planner is an important decision; you want to be comfortable with your decision for the rest of your life. Take the time to thoroughly screen your potential candidates and make sure you’re happy with your choice.