We may be biased in this, however, these are the qualities we believe make a top financial advisor:
- Fee-only: When looking for a financial advisor, we encourage talking with a fee-only, fiduciary financial advisor. "Fee-only" means that the advisor is charging an agreed upon, yearly fee to both manage your investments and help guide you through your financial goals. This fee structure indicates that there is no commission being made for the sale of financial products. (Link to article on how advisors get paid).
- Fiduciaries: A fiduciary advisor is a financial advisor who must act in their client's best interest. This means that their own benefit comes second to the client's. When talking with a financial advisor, please feel comfortable asking what makes up their fee and if they are a fiduciary.
- An Independent Financial Advisor: Checking to see if the financial advisor you are meeting with is independent is also a factor we recommend. Being independent means the financial advisor is not employed through a broker-dealer or an insurance agency. A broker-dealer is a firm that sells stocks to their clients that they own themselves. Whereas with an independent advisor, the firm does not have an affiliation with a specific broker-dealer or insurance provider.We believe this limits possible conflicts of interest between the advisor and client.
- Certified Financial Planners (CFP): Certified Financial Planners bring a high level of training, fiduciary ethical standards, and typically a more holistic approach to financial planning. Unlike advisors who work on commissions and might prioritize their own earnings, CFPs are required to act in your best interest, and stay current with the latest financial strategies.
- A Comprehensive Strategy: Comprehensive financial planners go beyond simply managing your investments; they guide you through budgeting, tax planning, retirement strategies, and estate planning. This holistic approach allows all areas of your finances, values, and wishes to work together, leading to better long-term outcomes and peace of mind.
Overall, it is best to remember your reason for wanting to work with a financial advisor. The financial advising space can be overwhelming initially, so hopefully, our points will help you as a starting point on your journey!