When it comes to selecting a financial advisor, being picky is not pretentious. Alongside choosing a career path, it’s one of the most influential financial decisions you’ll possibly ever make. For most, the process of choosing an advisor is an elaborate banquet of information-overload, served with a side of edgy apprehension. The good news is, heeding the warning signs is practically effortless and yet has the potential to swiftly narrow your advisor search to find the best fit for you.
3 Red Flags of the Wrong Financial Advisor:
1. A lack of fee transparency
If a potential financial advisor cannot answer the question, “How are you compensated for your advice?” consider a checkmark in the CON column. Honest, trustworthy financial advisors will be able to clearly outline the fees associated with working with them. If they beat around the bush and avoid answering the question, your best interests probably aren’t a top priority. When you walk away from an initial interview meeting, you’ll want to feel as though they really listened to your goals along with your current situation and genuinely care about helping you achieve your financial goals.
2. A shortage of positive reviews
Considering what others have to say about a particular financial advisor is a critical piece of the puzzle and should not to be overlooked. If a friend, peer, or family member doesn’t have anything positive to say about a potential advisor, you should move on. Remember, a successful financial advisor will come with positive feedback.
3. Trail of suspicious activity
If you already have a financial advisor, this is an easy checkup you can perform to ensure your advisor is on your side. Many advisors claim they are licensed and/or certified, but how do you really know if those titles are fact or fiction? Fortunately, there are some great resources for this very piece of the puzzle. Websites like the CFP Board and FPA (Financial Planning Association), have an advisor searching feature that may be helpful in your search for a Financial Advisor.
- Content written by Chelsea McLaughlin, Worley Erhart-Graves Financial Advisors