4 Questions To Ask When Interviewing a Financial Advisor

Financial Advisors have a variety of different and prestigious titles these days. Financial Planner. Stockbroker. Advisor. Analyst. No matter what they call themselves, you really need to do your homework on them.

Hiring a Financial Advisor is a very important decision. Whether it’s investment management, financial planning, or estate planning, a trustworthy and competent Financial Advisor can bring reassurance to your household. He or She, ideally, will also bring accountability into the equation as well. Investments tank? Blame them. Run out of money at age 82? Blame them. Having someone else to hold accountable is significantly easier than swallowing that huge embarrassing failure on your own, should either of those crummy situations happen to you. It’s so much easier to point the finger outward than inward, especially in this case, isn’t it? (Hint: the answer is yes).

If you’re currently shopping for a new Financial Advisor, or have a current one who maybe you’re not 100% satisfied with, I encourage you, scratch that, I implore you, to take this opportunity, right now, and do some seriously worthwhile research. That last sentence may have been a record for most commas used in a single utterance. Homework on both the advisor himself/herself, and on the firm that person is with. There’s this wonderful thing called the internet these days and it’s incredibly helpful for tasks such as this.

So, without further ado…. (drumroll please) here are 4 questions you should ask any Financial Advisor:

1) What designations do you hold? (CFP®, CFA, CPA, CIMA® ChFc, CLU)

2) What is your investment philosophy? Is it written?

3) Where can I do a background check on you?

4) What is your fee? What other fee(s) may be involved in the investments you choose?

While this by no means a complete list of all things I would ask a potential advisor I am interviewing, but it’s a good start. Let’s break each question down a little bit, shall we?

Designations – In my opinion, designations are important, but not for the reason(s) you might expect. There are a ton of designations out there that a person can get. Some are much more comprehensive than others. CFP®, CFA, CPA, or CIMA® are widely held in high regard, in terms of financial designations. Held in high regard in that it takes a lot of study, knowledge, discipline, and expertise to attain. I’m not trashing any other designation, but those 4 are no joke. Designation(s) are important because they cost a lot of money and they take a lot of time and self-discipline in order to obtain. In most cases, but not all, no advisor has a gun to their head forcing them to get said designation. It shows a high level of motivation to learn, grow and become a better Financial Advisor if someone has one (or more) of those 4 designations listed above.

Philosophy – What does the advisor believe in? Active management? Passive management? How about international exposure? How much should you have? Why? Why not? See what I’m getting at? That’s 8 questions in a row. Grammatical mastery right there. Of equal importance to finding out investment philosophy is asking if he/she has is it written down someplace that you can see. Have they written a book you can read about it in? Do they have a financial blog or newsletter you can peruse? That’s all stuff I’d like to know if I were you, but I’m not you. So, do whatever you want I guess.

Background check – This is probably the most important question to ask. It’s also the easiest question to answer. FINRA Brokercheck is where I’d suggest going first as it’s the most comprehensive (https://brokercheck.finra.org). I’m also going to give you 2 other links to lookup information on a financial advisor:

  1. Wealthminder.com
  2. Brightscope.com

Just go to one or all of those sites and do some research before you decide to hire or fire a Financial Advisor. You won’t regret it.

Fee(s) – In a sort of depressing string of events while working with prospective clients over the years I’ve found that a considerable sect of retail investors have zippo idea what they’re paying in fee(s) each year. I use the word fee(s) on purpose. There may be a number of them in your portfolio. There may only be 1. I have no idea. I’ve never seen your investment portfolio. Point is: find out. If you feel the advisor is worth the fee He or She is charging, then great. If not, well it may be time to make a change. Either way, you should find out.

The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. 

Investing involves risk including loss of principle. No strategy assures success of protects against loss.

Bonds are subject to market and interest rate risk if sold prior to maturity. Bond values will decline as interest rates rise and bonds are subject to availability and change in price.

International investing involves special risks such as currency fluctuation and political instability and may not be suitable for all investors. 

Investing in mutual funds involves risk, including possible loss of principle. Value will fluctuate with market conditions and may not achieve its investment objective. 

An investment in Exchange Traded Funds (ETF), structured as a mutual fund or unit investment trust, involves the risk of losing money and should be considered as part of an overall program, not a complete investment program. An investment in ETFs involves additional risks such as not diversified, price volatility, competitive industry pressure, international political and economic developments, possible trading halts and index tracking errors. 

Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Cornerstone Wealth Management LLC, a registered investment advisor. Cornerstone Wealth Management LLC and RP Zeigler Investment Services, Inc. are separate entities from LPL Financial. 

The LPL Financial Registered Representative associated with this site may only discuss and/or transact securities business with residents of the following states: Illinois, Indiana, Florida, Colorado, Michigan, North Carolina, Iowa and Texas.

Subscribe To Our Newsletter

and Never miss out

More To Explore


What Should You Do With Your 401(k)?

What should you be doing with your 401(k) right now? Should you sell everything and wait for the dust to settle? Should you just sit tight? Should you accelerate your 2020 contributions while the stock markets are down? Should you stop contributing altogether?

Read More »
Close Menu