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Questions to Ask When Hiring a Financial Advisor

 Posted on August 13, 2015 in Estate Planning

hiring a financial advisor, DuPage County Estate Planning AttorneyEstate and retirement planning may involve consulting with a financial advisor. A financial advisor is someone who sits with clients, determines what the client's financial goals are—i.e. retirement—and then directs the client to the appropriate investments which will help the client meet those goals.

Just like when hiring any professional, there are certain criteria you should look for when deciding on an advisor for your financial future. Moreover, key questions should be asked to a potential advisor which will assist you in deciding if this is the person for you.


First, you need to know how a financial advisor is compensated for his or her service. There are several different options, including commission, fee for their service, a percentage of assets under management, or some type of combination of these options. For those advisors who charge a fee, make sure you are dealing with one who offers a transparent fee structure. Typically, any fee that is more than 1 percent of your total assets is too high.

How Does the Financial Advisor's Returns Match Up?

Standard & Poor utilizes a 500 index. This index is commonly viewed as an industry benchmark for the American stock market. Find out if the portfolio returns of your potential financial advisor are at least matching—if not surpassing—that index.

Training and Education

There is no universal standard for those that call themselves financial advisors like there are for other professionals. There are more than 100 financial advisor classifications, and many of those titles are actually empty—they do not mean anything.

Currently, the top three certifications are certified financial planner, chartered financial analyst, and the personal financial specialist. A personal financial specialist also requires the advisor to have earned their CPA credential. Make sure the person who you are going to entrust your finances is qualified and not only has received the education and training, but also has substantial experience as well.

Is the Advisor a Fiduciary?

There are two different types of standards in the financial industry. The first is the suitability standard. Financial advisors who operate under this standard are only required to make sure an investment is suitable for a client at the time of the investment, and are not necessarily working with the client's best interest in mind. Many stock brokers, investment brokers, and insurance salespeople usually work under the suitability standard.

The fiduciary standard is one where the financial advisor is required to avoid any conflicts of interest, as well as offer a full transparency in their operation. For your own protection, make sure the financial advisor you choose works under the fiduciary standard.

Contact a Skilled Estate Planning Attorney Today

If you need to sit down and figure out future estate planning, or update your current plans, contact an experienced DuPage County estate planning attorney. Call the law firm of Stock, Carlson & Asso. LLC today at 630-665-2500.

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