People may not often think about a financial advisor unless they are starting to plan for retirement. However, having someone you can go to when you have financial questions is a good idea. Here are some tips to find a good and qualified advisor if you’re searching for one.
Ask friends and family if they can recommend a good and qualified financial advisor. If someone is willing to give a verbal endorsement, you know they’re pleased with their advice and relationship.
Set up an interview. Basically, hiring a financial advisor is similar to hiring an employee. Choose at least four financial advisors to speak with from different firms. The person you choose is going to be working for you, so it’s important to sit down face-to-face and talk with them.
Ask for references. If they are insulted that you would ask, you probably don’t want to hire them. Good financial advisors will be happy to provide you with names of satisfied clients.
Experience matters. Try to find a financial advisor with at least five years’ experience. This will be especially helpful if you’re unfamiliar with financial planning so you have the benefit of their experience to fall back on.
Ask their score on the Series 7 exam. The Series 7 exam tests a financial advisor’s knowledge. A score of 73 is about average, so you’ll want to find a financial advisor with a score of 85 or better. If you find one with this score, you know they know their stuff and you can feel comfortable with the advice they’ll give.
Check the Better Business Bureau (BBB). The BBB will be able to tell you if there have been reports against them. Take any reports from the BBB into consideration when deciding on a financial advisor or firm.
Choose someone you’re compatible with. Will they be available to speak with you if you have questions? Will they give you clear explanations if you’re unsure of terminology? Will your input be taken seriously? Do you feel respected or condescended to?
Avoid financial advisors that:
* Guarantee you’ll make money by following their advice.
* Opposes mutual funds, stocks, bonds, or CDs as a form of investment.
* Suggests only one area of investment. Most will recommend putting your money in more than one type.
* Ignores your instructions or argues with you when you give them direction.
* Won’t tell you what their commission is.
Your financial future isn’t something to play with. By following these tips to find a good and qualified financial advisor, you may be able to begin a relationship that can greatly influence your retirement and the rest of your life. Choose wisely and you could also end up making a good friend.
