Does Your Financial Advisor Put Your Goals First?

  • The decision to trust someone with your hard-earned money is very personal.
    Whether you’re looking for a financial advisor on your own, or are referred by your loving uncle, we invite you to consider these five criteria before you begin your relationship.

    1. CUSTOMIZATION

    Your needs are unique—and your investment strategy should be too. Make sure your advisor takes the time to understand your personal goals in order to recommend a customized plan that aligns with your risk tolerance. For example, your advisor may select investments that earn less in your portfolio, yet make you feel more comfortable.

    2. COMPENSATION

    Consider an advisor who charges a fee for services rather than commission-only from sales of stocks, insurance or other types of investments. This can be an hourly fee, or a percentage of your portfolio, but it helps ensure that he or she is working to grow your investments, and not profiting primarily from sales.

  • 3. EXPERIENCE

    A good rule of thumb: look for a financial advisor with at least three years’ experience, and be sure to ask with what types of investing he or she is most experienced. If the answer is “active trading in equities” and you’re looking for a conservative financial plan (or are about to retire), this advisor may not be a good match.

    4. INVESTMENT APPROACH

    Every investor is unique. Make sure your advisor’s investing philosophy isn’t too conservative or aggressive for your investing style. And be sure to check the assumptions this advisor uses when projecting rates of return—if they seem particularly rosy (e.g., 15% with an inflation rate of 2%)—then the goals might not be very realistic and/or attainable for the long-term.

    5. ACCESSIBILITY

    Regardless of how much you have to invest, your financial advisor should be working with your best interests in mind. Even if you prefer to meet in person only quarterly, or even yearly to discuss your portfolio, your advisor should always be available to answer your questions in a timely manner.

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