Personally i recommend that everyone gets financially educated and learns how to do basic investing. Even if you decide to select an advisor instead investing your self this will help you manage them.
In my experience many advisors are simply sales people who are going to push you into a managed product then move on. this assumes you have <1-2 million in investable assets.
Once you start getting to higher Investable asset levels there are some things like IPOs and tax advice that you can get that are very useful. As well as unique investment products
If your going to select an advisor here are some things to ask:
- Google their broker U4. Here is the link: https://brokercheck.finra.org/
This is online and simple to find. This shows all their customer complaints and issues. Obvi avoid anyone with complaints
- Understand what their client asset tiers are. Advisors get compensated based on Assets they manage. They literally are told to focus on higher value clients!
2.1. Related to point 2. Smaller brokerage firms tend to less good advanced products for high asset clients like IPO access. However they also don’t push advisors to focus only on higher asset clients as much. If you have more assets then a larger firm maybe a better choice.
-
Ask about what types of products do they normally put clients into. Ask them their opinion on ETFs (typically they want to avoid ETFs unless in a managed account)
-
Ask them how often you will be talking with them
-
Ask how their advice will be different than simply putting money into a target date fund
-
Ask how they get compensated. Ask on every product they want to put you in what your costs are
-
Ask to see what your financial report and website will look like
-
Ask them how often you will be meeting them.
-
Try to understand their approach to the markets. Are they aggressive? Conservative? Obviously you want to match your goals vs their approach
-
Do they come across as salesy and pushy? Are they cocky? Then avoid
In general. If it’s not working out don’t feel weird about finding a new advisor and moving on. It’s YOUR MONEY. Protect it!!!
Leave a Reply