Questions You Should ask Financial Advisors Before Hiring Them

May 17, 2021

Hiring your first financial advisor can be a little nerve-wracking, especially if you’re unsure exactly how you want to build your portfolio. The right financial advisor questions can’t mitigate against every risk, but they can go a long way to helping you develop the right relationship with your financial advisor, making it easier to plan ahead.


What’s Your Specialty?

A financial advisor can specialize in any number of areas, including taxes, investing, Social Security, insurance, etc. From bonds to real estate, you should determine what kind of expertise and certifications an advisor has. For instance, a Certified Public Accountant (CPA) will specialize in the tax code, while a Personal Financial Specialist (PFS) takes it a step further to help with comprehensive planning. This doesn’t mean a CPA won’t be able to make strategic moves, only that their education and career plans differ from that of a PFS. This could affect the advice they give you.


What’s Your Minimum Investment?

Financial advisors typically work with clients who have enough assets to invest in. For some, the minimum is set at millions of dollars! Thankfully, there are firms that will take clients with less to invest, but it pays to do your research on minimums before you commit to one firm or professional. And remember, just because you have that much money doesn’t mean you should be investing it all. Make sure that you’re keeping some left for emergencies and other future goals.



What Are Your Interests?

A suitability obligation and fiduciary duty are two different things, though both are likely terms you aren’t used to saying on an everyday basis. A suitability obligation essentially refers to a financial advisor’s requirement to make reasonable suggestions to their clients, while fiduciary duty requires them to put their clients’ interests before theirs. This is also an excellent time to ask about a financial advisor’s past. If they have any type of disciplinary action, they should disclose this information. They should also be open if their firm has had any run-ins with the law as well.


How Are You Paid?

A fee-only advisor will make money from clients, while fee-based can sell products for a commission as well. Fee-based advisors may have more access to products that could help clients, but the downside is that the advisor might be tempted to sell a more expensive product based on what they’ll earn from the sale. A fee-only advisor will work exclusively for the client but may be more limited in terms of what they can offer.

Greenberg Financial Group knows that it can be challenging to find the right financial advisor questions when you’re put on the spot. Use this list to help you prepare when you’re hiring your first financial advisor, and it should be easier to navigate the interactions you have. If you have any questions about our financial advisor services in Tucson, give us a call to learn how we can help.

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