Finding the Right Financial Advisor Based on Your Needs

5 Tips for Selecting the Best Financial Professional for You

Money is a sensitive topic for many people, which can feel a bit taboo to discuss. However, if you’re not an expert in financial matters, we believe it’s important to partner with a financial advisor to help you make thoughtful decisions for your future. Of course, choosing a financial advisor who you trust and who serves your needs can be a challenge. Below, we’ll walk through five of our suggestions designed to help you choose the right advisor for you.

Why You Can’t Choose Just Any Financial Advisor

Before we jump into the strategy you should use to select your financial advisor, it’s important to understand why we believe it’s so critical to find the right one. After all, you’ll be giving your advisor access to one of the most confidential and significant parts of your life.

Think of it as hiring an expert to help you work toward your personal goals. Many people who call themselves financial “advisors” are more like salespeople, earning commissions for selling you financial products that you may – or may not – truly need or benefit from. We suggest a financial advisor who works in your best interests and with your unique goals in mind and one who takes the time to answer your questions and listen to your needs. Essentially, the process involves finding an advisor who is competent and responsive.

Tip #1: Choose a Fiduciary

It may surprise you to know that not all financial planners are required by law to act solely with your best interest in mind. That’s why it’s important to select one who must meet the fiduciary standard of care under federal law, such as registered investment advisers registered with the Securities and Exchange Commission who are regulated under the Investment Advisers Act of 1940, and financial advisors with a CERTIFIED FINANCIAL PLANNER™ designation or Chartered Financial Analyst® designation must also meet the fiduciary standard of care in addition to other certification requirements.

Note that broker-dealers, though regulated by a different federal law, are only required to meet the weaker “suitability standard of care,” which means you may or may not be getting financial recommendations that truly serve your best interests. So, be sure to check the credentials of any advisor you are considering. You can verify credentials through the CFP Board or through the CFA Institute.

Tip #2: Learn How the Advisor Gets Paid

Be wary of “free” financial advisors. If you aren’t paying them for their work, someone else is – and who that someone else is matters. Are they salespeople for a financial product company? This is actually fairly common, and something we recommend you avoid. We believe it’s better to work with someone held to a standard of care and a duty of loyalty, rather than someone who is trying to earn a commission.

If an advisor isn’t upfront about how they are paid, you can ask questions like:

  • Do you earn a commission on insurance sales?
  • Do you earn a commission on stock transactions?
  • Are you affiliated with a financial product company?

Their answers can help you determine whether you would truly get unbiased advice from their firm.

Tip #3:  Get Clear Answers

Financial matters can be complex – even just the terminology is enough to cause overwhelm when a concept or product is new to you. Any worthwhile financial advisor should be able to answer your questions to your complete satisfaction and explain any concepts or products clearly. Obscure answers are no true answers, so seek out complete clarity. In addition – and this is important – an advisor should be able to do these things without making you feel incompetent or like your questions are an annoyance. If an advisor you are considering dodges questions, uses finance lingo without providing clarity, or leaves you with a negative impression, these are red flags.

Tip #4: Seek to Be Understood

Do you want a financial advisor who is held to a fiduciary standard, who is compensated in a way you’re comfortable with, and who provides you with clarity? We assume the answer is yes. However, there’s another critical ingredient to finding the best financial advisor for you, and it’s all about active listening. Don’t underestimate the importance of truly being heard. We find it important for you to work with an advisor who not only listens to what you’re saying, but who asks questions about your goals and values, and who uses your specific answers to craft your financial plan. Ideally, they should also be a voice of calm and reason in times of stress, as well, such as extreme market volatility that is impacting you from an emotional standpoint.

Questions to Ask During Your Interview Process

It can help to treat the process of choosing a financial advisor like a job interview. Here are a few helpful questions you may want to ask to help you quickly get to the root of some of the points mentioned above, as well as other critical matters:

  • Are you a fiduciary?
  • What are your credentials?
  • How do you get paid?
  • How will we communicate?
  • What happens if you leave the firm?

Remember, there is no limit on questions you should ask. An advisor worth your time and money will answer as many questions as you need in order to make an informed decision.

Final Thoughts on Finding the Right Financial Advisor for You

Building a relationship with a trusted advisor can mean peace of mind for years to come, and a go-to professional for your questions and concerns.

At Aviance Capital Partners, we recognize what an important and personal decision it is to entrust a financial advisor with your financial future. We meet the fiduciary standard for each client, and we pride ourselves on our friendly and professional approach to fulfilling each client’s individual needs. Reach out to us today for a no-obligation conversation, and we will answer any questions you may have about how we can assist you with building and maintaining your wealth now and into the future.

Bottom Line

Finding an advisor is not as simple as going with the person a fund company or insurance broker assigns you. You need to actively search out someone who’s going to work in your best interest, and that takes some time. But in the end, you’re probably going to get better advice, save money, and earn more while achieving your financial goals. That’s worth the extra legwork in helping you find an advisor that you can work with for decades.

Aviance Capital Partners, LLC (“ACP”) is an SEC registered investment adviser located in Naples, Florida. Registration as an investment adviser is not an endorsement by securities regulators and does not imply that ACP has attained a certain level of skill, training, or ability. While information presented is believed to be factual and up-to-date, ACP does not guarantee its accuracy and it should not be regarded as a complete analysis of the subjects discussed. All expressions of opinion reflect the judgment of the authors as of the date of publication and are subject to change. The tax and estate planning information provided is general in nature, which should not be construed as specific financial planning or tax advice tailored to an individual reader. ACP suggests that readers consult a financial professional, attorney or tax advisory professional about their specific financial, legal or tax situation. Certified Financial Planner Board of Standards, Inc. (“CFP Board”) owns the CFP® certification mark, the CERTIFIED FINANCIAL PLANNER™ certification mark, and the CFP® certification mark (with flame design) logo in the United States (these marks are collectively referred to as the “CFP® marks”). The CFP Board authorizes use of the CFP® marks by individuals who successfully complete the CFP Board’s initial and ongoing certification requirements. CFA® designates an international professional certificate that is offered by the CFA Institute, which authorizes use of its marks by individuals who successfully complete the initial and ongoing certification requirements. Past investment performance does not guarantee future results. All investment strategies have the potential for profit or loss, and different investments and types of investments involve varying degrees of risk. There can be no assurance that the future performance of any specific investment or investment strategy, including those undertaken or recommended by ACP, will be profitable or equal any historical performance level. Additional information about ACP, including its Form ADV Part 2A describing its services, fees, and applicable conflicts of interest and its Form CRS is available upon request and at https://adviserinfo.sec.gov/firm/summary/146597.

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