How To Find And Choose A Financial Advisor
Finding a financial expert is a very critical task. While choosing the right one can provide innumerable benefits, a wrong choice can cause severe damage. An efficient specialist plays a pivotal role in helping you achieve your financial goals and strengthening your foundations. But with so many options available today, it is not easy to make the right choice. You can rely on recommendations from peers, or seek help from the Financial advisor matching tool, or tap other sources to find someone that suits your monetary needs and understands your future goals. Even though the process can be time-consuming, the benefits prevail throughout your entire life.
Here are some easy ways to find the right financial advisor for you:
Assess your needs
Primarily, you must understand how much financial help you truly require. Some questions that can help you determine your needs are, the worth of your estate, the complexity of your investments, the size of your investment portfolio, and the timeline of your goals. Based on these, you can decide on the mode of engagement such as, an hourly-consultation, comprehensive support, or long-term asset management. As per your requirements, you can also choose to either engage with the consultant on a commission-based method, a fee-based agreement, or a fee-only system. In the fee-only system, the advisor is under an obligation to place your interest before their own. Thus, their compensation is not linked to any product. Instead, it is based on a flat fee set-up, hourly rate, or as a share of the assets that they manage.
After an all-inclusive assessment of the needs and the preferred type of engagement, the next step is to look at the available options. An effective way to find a suitable financial advisor is to consult your friends and family who are currently engaging with an advisor or have in the past consulted a similar professional. Consider specialists that have the expertise of your requirements and do not cause a dent in your budget. You can also ask your colleagues for some recommendations since people in the same financial situation are most likely to offer a more germane referral. As a word of caution, it may not be prudent to merely rely on suggestions. You must get information from other valuable sources too and conduct an in-depth evaluation before finalizing the contract.
Use advanced research tools
In addition to taking references from friends, colleagues, and family members, it is important to conduct your own research. To collect information on some of the best financial professionals, you can use other online tools such as WiserAdvisor's advisor match tool. This tool uses complex algorithms to connect you with pre-screened financial advisors in your area. These experts are tested based on their experience, compensation arrangement (fee-based or fee-only), licensing and disclosures related to the U.S. Securities and Exchange Commission and the Financial Industry Regulatory Authority (SEC/FINRA). WiserAdvisor's advisor match tool runs a custom search and provides profiles that match your specific needs and based on your particular requirements, WiserAdvisor professionals contact you for a one-on-one consultation. There is no obligation to engage the concerned advisor and the final decision completely depends on your comfort and suitability.
Tap online databases
Several financial firms have a database of consultants online. This professional advisor network contains in-depth information on qualified specialists such as certifications, credentials, ethical ratings, level of experience, expertise, licenses, etc. In some of the advanced databases, the advisors are segregated as per their state, allowing users’ easy access to the best professionals nearby. Tools such as our own tool the Financial Advisor Directory or other sites like the WiserAdvisor Financial Advisors Directory, Garret Planning Network, National Association of Personal Financial Advisors (NAPFA), and Financial Planning Association, etc. can help you make a fair comparison and an unbiased decision.
That said, once you have obtained a list of suitable candidates, it is essential to understand the criticality of choosing the right one. You will be entrusting your wealth plans and other personal information into the hands of that individual. To select a trustworthy person, capable of providing unbiased advice as per your goals, you must be cautious and patient through the selection process. In addition to the above steps, you can also consider these useful tips to determine the suitability of your financial advisor:
Check registrations and regulators
The foremost selection criterion is to determine which authority governs the considered professional. Many regulatory bodies are affiliated with financial advisory firms. Yet not all those authorities are respected. You can choose an individual or a firm that is registered with the Financial Industry Regulatory Authority (FINRA) or the Securities and Exchange Commission (SEC). For professionals, who are regulated by FINRA, you can also check their securities license along with other permits by visiting FINRA’s or SEC FINRA’s official website or tapping on online professional advisor networks such as the WiserAdvisor Financial Advisors Directory. This directory helps you to find a professional with the desired licenses and certifications.
Confirm professional licenses and certifications
A good financial expert will most likely hold a General Securities Representative license, which is also known as the Series 7 license. This particular license assures that the individual has the required skills and expertise to offer financial services. In case, you are searching for a cross-state specialist, you must check for the Series 63 license too (Uniform Securities Agent State). This license is given to a person with authority to conduct business across different states. Checking the relevant licenses is helpful if you are looking at engaging an advisor for a specific service, such as retirement consultation, insurance advice, etc. It is recommended to confirm all professional licenses in advance and engage with the advisor only after being satisfied. Additionally, each service type requires a particular certification, such as RMA (Retirement Management Advisor), RICP (Retirement Income Certified Professional), or CRC (Certified Retirement Counselor). Overall, a CFP (Certified Financial Planner) or a PFS (Personal Financial Specialist) has the necessary education, experience, and ethics required for the job. On the other hand, to save time and ensure 100% accuracy in finding the right and authenticated match, you can use advanced tools as the WiserAdvisor’s advisor match tool.
Run an exhaustive background check
Once everything is sorted, you can conduct a background check for the professional. This can confirm factors like educational qualifications, the validity of credentials, existing legal contracts, clients, etc. You can also keep a lookout for any criminal convictions or any legal action/scrutiny by a regulatory or legal authority. Moreover, verifying the behavioral history, past instances of conflicts of interest, etc. on the FINRA Disciplinary Actions Online database can be insightful. You can also rely on WiserAdvisor’s advisor match tool, which suggests financial advisors, pre-screened based on areas such as experience, advisor compensation arrangement (fee-based or fee-only), licensing and disclosures related to SEC/FINRA. This tool allows you to understand the pay structure of the consultants and to engage in services that fit your budget.
To sum it up
Finding and selecting the ideal financial advisor can be confusing. But with the introduction of reliable online tools and databases, the process has become less challenging. However, it is important to be patient and execute the process with precision to be certain that the partner in your monetary journey is capable and the best suited.