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5 Ways to Evaluate a Financial Adviser

11 December 2019 No Comment

If you have decided to work with an investment adviser, you probably understand why you need to do some research before hiring someone. After all, this specialist will advise and guide your financial strategies, affecting your future financial security. Some professionals, depending upon the parameter of duties agreed upon, may even make financial choices for you. What you may be unsure about, though, is how to assess a money professional. Here are five ways to evaluate a financial adviser so you can make the best choice for you and your financial future.

1. Check on professional designations.

There are different types of financial professionals, but you need to always look for someone who is has a professional designation. The Financial Industry Regulatory Authority (FINRA) has a webpage about financial designations that helps you understand what each one means. The information about FINRA members on this database also includes a link to the issuing authority so you can click through to check for that individual’s name on their registry and to learn more about the credentials. Checking credentials is important. Doing so is not rude or distrustful. Rather, you are advocating for yourself and looking out for your best interests.

2. Research work background.

Before you trust a financial adviser with your personal finances, you need to know more about her or his professional background. There are two good ways to do this.

•        FINRA’s BrokerCheck lets you look up names to discover if a particular money manager has any past complaints and disciplinary actions on record.

•        The SEC has a search feature you can use to find out more information on individual advisers as well as the firms they work for.

Some advisers are registered with both FINRA and the SEC. It is ideal to work with a money professional who is honest and forthcoming about their professional background.

3. Read reviews.

Look for unbiased reviews about investment advisers. This is an excellent way to get useful information about financing professionals. Look for knowledgeable sources who publish well-written critiques, such as this review of Fisher Investments, an independent money manager.

While testimonials can be helpful in reassuring you when you have firmed up your decision, critiques of performance and methods from outside parties can give you data that fleshes out facts and figures collected from databases. Before hiring anyone to work with your finances, you want to form as complete a picture as possible of background, working style, and reputation. Reviews help you do this.

4. Look for professional websites.

Visit an adviser’s website to get a perspective of this money professional’s viewpoints, philosophy, values, and working style. Study different pages, including biographies and services provided. If there is a blog, look at the subjects covered and read some posts. What is the overall tone of the site? Is the adviser transparent about fees and procedures? You can tell a lot about a money adviser from a professional website. Asset manager Fisher Investments, for example, presents easy-to-read bullet points with important information on the home page.

5. Assess availability.

The financial world moves quickly, and as such, your financial situation can alter just as suddenly. You want to work with an adviser who will be available. Some money managers like to meet with clients annually, while others suggest monthly or quarterly meetings. However, some situations such as home buying, education fund planning, or business start-ups may require more attention, at least for a while. Be sure and pinpoint how available a money manager is willing to be for unexpected circumstances as well as for regular business, and make your choice based upon your comfort zone.

Deciding to work with a financial adviser is a big decision. However, you can make it easier by carefully vetting potential money managers. You need to feel comfortable with the professional you choose in order to get the most out of this important relationship.

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