How to Choose an Advisor

Choose a financial advisor as you would the second most important person in your life

Know what you want. Be picky. Don’t compromise.

The right financial advisor can do much more than help you invest. He or she can help you with everything financial in your life.

Your financial advisor can function as a confidante, coach, and supporter. As a trusted friend who tells you straight if you are off base. The right advisor will keep you on track to meet your goals.

Start with advisors who are competent, objective, and know what it means to serve their clients’ best interest. Consider advisors who have committed, in writing, to follow ‘best practices’ that are key to excellent advice.

You Should Expect Your Advisor to:

  1. Acknowledge in writing that she/he is a fiduciary* financial advisor at all times.
  2. Put your agreements, important disclosures, and lists her/his services in writing.
  3. Make recommendations based on a written investment plan crafted after carefully reviewing your financial situation, personal circumstances, and your goals.
  4. Not recommend principal trades or proprietary products – unless you ask him/her to.
  5. Seek to avoid conflicts** and put in writing and explained to you the impact of any unavoidable conflicts so you can provide informed consent to your advisor that it’s okay to proceed with the recommendation.
  6. Give you a written accounting of ALL the fees and expenses involved that you pay and that the advisory firm collects or, at least, will provide a good faith estimate of all fees and expenses on request.

See our Best Practice Advisor Registry.

*A fiduciary is a person or organization that owes to another the duties of good faith and trust. The highest legal duty of one party to another, it also involves being bound ethically to act in the other’s best interests. Read more at Investopia.com: http://www.investopedia.com/terms/f/fiduciary.asp#ixzz4xT5x7A

**A conflict of interest is anything that puts the investor at risk for the personal gain of the financial professional. Such conflicts of interest generally put the interests of the professional ahead of the investor, and in some cases can even cause harm to the investor as a result of a financial professional’s outside interests. (via MoneyGuy.com: http://www.moneyguy.com/2017/03/conflicts-of-interest-in-financial-services-how-every-investor-can-learn-to-spot-them/)