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5 Questions To Ask Your Financial Planner?

5 Questions To Ask Your Financial Planner?

April 29, 2021

Choosing a financial advisor is not a choice that should be made haphazardly.  This relationship is no different than having your dentist, mechanic, barber, or any other professional relationship.  This kind of relationship is one that will hopefully last for many years into the future.  Much like your other professional relationships, you must do some due diligence.  Some will come with trial and error, while most of it can be attained through extensive questioning and due diligence on your part.  Here are 5 questions you should ask your Financial Advisor before engaging in their services...

  • What Is Your Ideal Client?  Most financial advisors have minimums or specific clients  in which they work well.  It is imperative to find out where you may fit into that client process as to not waste your time in a dysfunctional relationship.  People often avoid this question and engage the financial advisor, later to find out that what they are offering does not fit their current profile.  It is best to have a full conversation upfront to see if you will be a good fit for one another.  Remember, you are not only interviewing that financial advisor, the financial advisor is interviewing you as the possible client as well. It is imperative that this be a conversation had specifically on the front-end of the client/financial professional relationship.
  • Are You A Balanced Planner?  The word "balanced" can have multiple connotations such as: having a balanced portfolio, being a fee-only or fee-based financial advisor, or acting in a "fair and balanced" interest of the client.  As a CERTIFIED FINANCIAL PLANNER™, acting in a "fair and balanced" manner supersedes all else based on the CFP® Standard of Excellence and CFP® Code of Ethics.  We are in no way saying that financial professionals in the commission world operate without balance, nor are we saying that all financial professionals who claim to be "fair and balanced" operate fairly.  It is important to understand what kind of financial professional you have on your team before you engage their services.
  • How Long Have You Been Practicing?  If you are a client that has been through multiple financial professionals in the span of 3-4 years, you are not alone.  No wonder people get fed up with the brokerage and wire-houses that give them a new financial advisor on their account each year.  It is a common practice within this industry to let go of low performing financial advisors without regard to the clients needs.  Clients then notice they have a freshly minted investment advisory representative that recently passed their exams and graduated from college.  Clients then need to reintroduce themselves once again and start a new planning process with said financial professionals, just to immediately do this again and again.  Does not make for a good client experience.  Find someone with significant experience that can build a long lasting relationship with you and your family.
  • How Do You Get Paid?  This question may be one of the most pertinent you may ask.  Discussing how an financial advisor is compensated will allow for you to see how they may operate their practice. Your financial advisor may be a fee-only, meaning they charge a planning fee or assets under management fee and receive zero in commissionable dollars.  This is presume to remove all conflicts of interest from the financial advisor relationship.  Then there is the fee-based financial advisor that gets paid on assets under management, fee's and commissions.  This is the world in which we operate here at 9Innings Capital Group, and we believe it allows us to use multiple carriers to provide substantial levels of competing services on behalf of our clients.  Maintaining a "non-captive" approach that gives us access to any level of services and carriers  that may provide for the best results.  Finally the commission based financial professional that sells products and services only.  This financial professional may or may not be a captive agent of an insurance or broker dealer.  This individual receives compensation on the products he/she produces and will receive a commission for selling those said products.  Whether you are searching for a fee based, fee-only or commission based financial professionals, it is important to understand how your financial professional gets paid.
  • What Is Your Specialization?  After discussing the ideal client, it is good to also find out where the financial advisor specialty lies.  Everyone has heard the term, "Jack of all trades, Master of None", and some financial advisors may fit in that mold.  They may come out and say, "We help anyone and everyone."  That is fine, however, how does that help you specifically?  At 9Innigns Capital Group, our specialty is in the individual/family space with 125/200k+ household income earnings,  and with 250k investable assets which allows us to create incredible financial plans for both individuals and professionals.  We strive to perform best for retirees that are at or near retirement with 250/500k+ of investable assets and provide specific retirement strategies using our background and experience as Retirement Income Certified Professionals.  Discussing one's specialty should be very smooth and unencumbered.  Finding a financial professionals  specialty will bring down the barriers and open up the conversation as to style and fit.

The conversation one must have when engaging a planner needs to have depth.  You have spent a lifetime making money for you, your family and your future self.  Placing that into the hands of those inexperienced, not specialized in what you are looking for, or a brokerage house that places you with a new financial advisor each year, does not make for a good experience.  Make sure to ask your prospective financial advisor these questions before you engage their services, as to make the experience much more enjoyable for you and your family.