How to Find a Financial Advisor
or Financial Planner Who is Right
for Your Needs in Today’s Volatile
Determine Your Goals
Usually it is a specific life change that causes someone to want to meet with a financial advisor. Often, it is rolling over a 401k when changing jobs, getting ready for retirement, or a young family that needs to start saving and needs life insurance protection to provide for the children. However, the full process of financial planning incorporates looking at your overall goals in life, and then setting financial goals to help you reach your lifetime goals. Many clients find their financial advisor can help guide them through these issues.
Finding Potential Financial Advisors
How do you find a financial advisor? Many people start by asking a family member or friend for a referral to a financial advisor. This can sometimes work, but your friend’s financial advisor might not be the right fit for you. Why? Your financial needs aren’t exactly the same as your friends. In fact, there are many financial issues that might require special expertise. Did you realize there are financial advisors who specialize in business owners, retirees, doctors, divorced women, socially responsible investing and even airline pilots? This makes sense because it takes time and experience for a financial planner to learn about employee benefit plans for the business owner, the complicated pension and benefit packages of the airline pilot, and all of the other specific areas for each niche. So an important part of choosing a financial advisor is looking for someone who is a match for any specific needs you have, and has experience working with other clients in a similar financial situation to you.
ClaroConnect.com provides a free, third-party search tool to screen through financial advisors. You can search by multiple criteria such as location, types of fees and even language. You can search for specific qualifications, such as Certified Financial Planner (CFP), Chartered Financial Analyst (CFA), registered investment advisor and others. In addition, there is a Custom Search feature which lets you type in any keywords you want, such as the above specialties of “socially responsible” or “pilot.”
Doing a Compliance or Background Check on Financial Advisors, Brokers and Investment Advisors
A background check on financial advisors is not a foolproof way to find a good advisor, but is necessary to at least weed out some of the advisors you don’t want to work with. Unfortunately, there are different organizations for different financial professionals. For registered representatives, stock brokers and many financial advisors, you should go to the FINRA website for their BrokerCheck. For registered investment advisors, you must go to the SEC website to pull up their disclosure form. And for insurance professionals, they are regulated separately by each state, so you must go to your state insurance commission.
Interviewing Financial Planners or Investment Advisors
You should interview any prospective financial advisor until you are fully comfortable before beginning work with them. As mentioned, you should determine if they have experience working with others in your financial situation. See if your investment philosophy aligns with theirs. Make sure you understand how any solutions they suggest will work. Make sure you understand how their fees work. Agree on how frequently you will communicate. Knowing this now can help prevent surprises later.
Getting Started with a Financial Advisor
Once you choose a financial advisor, they will probably then interview you to determine your goals, investment experience and risk tolerance. Financial planning is a process that gets updated each time your goals change, a new situation arises, or the markets drastically change. Many clients are thankful for the financial advice that helped put their kids through college and provided for their retirement income.