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  • Writer's pictureDavid J. Perrotto

7 actions to take when meeting with potential Financial Advisor

Great, you have a reason to meet with a financial advisor, and now you are going to interview someone, who hopefully will manage part or all your financial future. What should you do before you meet this potential advisor?

Here’s a quick rundown of what you should do before you even walk in the door, as well as what you should do one you area in the door.

Decide what help you are seeking. There are two different types of service you can hire an advisor for. Do you want financial planning or investment management? Your needs will help determine appropriate professionals to interview.

The former can involve advice and recommendations on one or two questions—or comprehensive attention to your entire financial picture; the latter involves turning over one's investment portfolio to a professional. Most advisers provide both services, but some don't.

Understand how each adviser is paid. You want to fully understand each person's compensation arrangements and possible conflicts of interest. Some advisers get paid only by their clients, in fees that are hourly or a flat sum or a percentage of assets under management. Others get commissions from financial-services companies for selling products, or a combination of fees and commissions.

An adviser whose compensation is strictly tied to the sale of products may be susceptible to bias. Product sellers, unlike most fee-paid advisers, may not be operating as fiduciaries who legally must put your interests first. Every advisor is being compensated. You want to ask something along the lines of “Are you a broker being compensated by commissions, or an advisor being compensated by a fee?” Be wary of one’s that say there is no fees involved. You also want to make sure you’re not being sold proprietary funds that are the managed in house. Simply ask "Does your firm offer proprietary mutual funds or separately managed accounts?"

Get organized. Some advisers ask to see pay stubs, tax returns, investment records, 401k/403b statements, even monthly budgets at an initial meeting. Others seek to keep the first meeting as casual and painless as possible by not requiring any documents at all. Still, reviewing key documents could make you better prepared for your conversation and for subsequent meetings with the adviser you select. Most good advisors want to see as much data as possible, so they can build a complete picture of your financial house before making a recommendation. Be wary of advisor's that don’t care to see your financial picture, and go right into pitching a product.


Be realistic. Don't expect immediate answers to your financial-planning need or concern. A good advisor tries to get to know a client and to read their documents and build a full financial picture before making a personalized recommendation. Be extremely wary of someone meeting you once and bringing you a product. Also, be wary of any adviser who promises to deliver high returns with little risk; there are no guarantees in financial markets. A good question to ask would be “What’s your philosophy on investing in general?”

Listen to your instincts. Relax, ask questions and get a sense of the adviser's communication style, you need to feel comfortable with this person because at the end of the day, sometime in the future they'll be working through some of your most personal financial issues. At some point, your advisor, should know more about you, and your spending habits, and your life goals. The first meeting is a chance for prospective clients to decide if they are comfortable with an adviser. You are looking to have your questions answered in simple, jargon-free terms. You want to ask questions like “What financial planning services do you offer beyond investment strategy and portfolio management?” to get a better feel for the advisor. You want to make sure he helps you with all areas of your financial life.

Be aware that you are also being interviewed. While the advisors may be interviewing to get your business, they are also trying to gauge whether you are the right fit for them. An advisor may decide that your personality or your finances aren't right for his or her practice. At the first meeting, a good advisor is also trying to get a deeper understanding of prospective clients, including issues or concerns that aren't stated. An advisor may see that the client is too much risk to take on, is asking for too much in returns, for the stated risk tolerance, or maybe their personalities just don’t clash well.

Know that an initial meeting might turn into two, or even three! The first meeting with an advisor may not be enough to judge whether he or she is the right match. If that is the case, prospective clients should give the planner at least one more shot. Your financial plan is an ever changing, fluid, and you will be making a commitment to someone, so don’t feel bad to meet with the prospective advisor a second or third time to get a good feel for them. Remember, choosing the wrong advisor, may cost you years in returns. There are no dumb questions, so ask away. Ultimately this is your money, you need to feel comfortable with who’s managing it.

This is a good foundation for you when you go into your first meeting with a potential advisor. Just remember, this is someone your entrusting your financial future with, someone you will want to go to before you buy a home, before you retire, before you expect to have a child. A good financial advisor will know many personal details about your life, and build a financial foundation that, hopefully your whole life will be built on.

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