5 Steps To Find the Right Financial Advisor

Financial Advisors are everywhere! They are on television, advertise on the radio and in magazines. They even knock on your door with pamphlets about how great they are while trying to get an appointment with you. They will hand you a business card with enough acronyms after their name to make a military acronym generator jealous.

Financial Advisors are even in the bank branch of your local supermarket between the latest and greatest display of chips and the dollar discount aisle. The point is you don’t have to go very far to find people who would like to manage your money.

But the real question is how to find one that is right for you? Do you ask the richest person you know for the number of his broker? Or your brother-in-law, the lawyer? Do you ask your CPA, your insurance agent, or your banker? The short answer is, yes to all!

It’s as simple as counting from one to five to choose your next financial advisor. You only need to know where to look and what questions to ask. Follow these five steps to guarantee you’re working with the right advisor.

1. Know if you need a financial advisor

Take the time to roll up your sleeves and get on paper a realistic view of where you are now and a list of milestones you would like to achieve over your lifetime. The purpose of this exercise is to develop the framework of needs and wants. It helps narrow down what type of financial advisor you need as well as shape the interview questions.

Functions of a financial advisor

  • Market research and analysis
  • Find new opportunities
  • Determine the needs and objectives of your clients.
  • Make sound investment choices
  • Monitor and review the performance of your investments
  • Recommend and carry out strategies
  • Account monitoring
  • Follow Securities and Exchange Commission regulations
  • Planning your savings and retirement
  • Property planning

If you can’t do all the tasks yourself, separate the tasks for which you need a financial advisor. Also, determine the selection criteria which makes it easy for you during the decision-making process if there are multiple potential financial advisors.

2. Interview potential financial advisors

The important thing to remember is it is not what they are called but what they do with your money. Interview a minimum of three potential advisors and always ask for a referral. Any advisor who is not willing to provide a referral isn’t worth your time.

Also, keep close eyes on the past experience of the potential financial advisor. The efficient and effective performance of the advisor depends not only on the knowledge and degree but on past experience and motivation for the task.

A few interview questions for financial advisors might be:

  • What made you decide to work in finance?
  • Why do you wish to work for this particular company?
  • How do you cultivate relationships with your customers?
  • Describe how you deal with difficult clients.
  • What data do you use to assess a client’s financial situation?
  • Describe the most effective financial approach you’ve devised.

After the interview, grade the outcomes of evaluation from different financial advisors and see who makes it to the decision criteria.

3. Reflect on past experience

If you have worked with a financial advisor in the past, take some time to reflect and determine the strengths and weaknesses of the former advisor. What did they do well? What would you have liked to have seen more of? And what didn’t they do well? This type of preparation will help you quickly gauge advisors that may be difficult to work with or do not meet your needs. It is also a signal to the potential investment advisor that you are serious about your financial future.

4. Know the requirements of the financial advisor

Just as you have your requirements, a financial advisor has theirs too. Some advisors have minimum account requirements and provide different levels of service based on the size of the account. Some work on a fee basis and others work on a commission basis. It is important to know how the relationship is going to work upfront.

5. Review the performance

When you employ a financial advisor, you are often entering into a long-term partnership, and it is critical to maintaining contact throughout the year. Don’t just look at investment results; consider the overall picture. Is the company responsive to your requests? Are your objectives being met, your questions being answered, and, most importantly, are you on the correct track? Communication is essential in all effective partnerships.


As mentioned at the beginning of this article, financial advisors are everywhere and they will often find you before you find them. Being prepared and ready to weed out the facts from the sales pitch makes you a more informed investor, a better client and the CEO of your money.

Finding the right financial advisor is more like putting together a 5,000-piece puzzle than fitting a glass slipper. The process of choosing the right financial advisor starts with asking the right questions regarding the need and type of financial advisor you seek.

Good luck and happy hunting!


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