You’ve worked hard for your money, and naturally you want it to work hard for you, too. You have got big plans for what you want it to accomplish – help you buy the perfect home, pay for your child’s college education, or support your lifestyle through retirement. So, how do you seek to preserve your money and help it grow so it can do its job for you? Many people rely on the services of a financial advisor.
A financial advisor is somebody who should be able to help you invest your money so that it is there when you need it. He or she should first spend time with you to understand your comfort level with risk and learn about your investment goals. That person should then be able to develop a plan, execute it, provide monitoring, and suggest course corrections as the market or your needs change.
This is a partner relationship you are forming, not a vendor, but you still need to ask some serious questions before you agree to work with somebody who could have a major impact on your life.
The four questions you will likely want to ask your Financial Advisor
1. What is your financial background?
Although everybody does have to start somewhere, a new person to the investment field may not necessarily be the best choice as a financial advisor. You want somebody who has been in the field for some time, has seen the various ups and downs the market can take, and has soundly guided clients through these gyrations. You can ask potential advisors if they have a college background in this field, or what courses and certifications they have taken.
2. What financial services do you offer?
Once you know the background of your financial advisor, you will want to know what types of services they offer. Some financial advisory companies offer different services because of the type and size of the firm they work for. As a potential client, you want to be able to understand what services they do offer and which ones work best for your specific situation.
3. How are you compensated?
You want to understand if a potential financial advisor has any underlying reasons to recommend certain investments. Sometimes they make commission for many years just by signing you up and keeping you in one type of investment product. If you have a retirement account, there may be a yearly administration fee involved. Other advisors may work for a flat fee that is based on the total value of your investment portfolio.
4. What is your client service philosophy?
Knowing how your financial advisor will provide you with quality service, be your trusted advisor, and make recommendations based upon your needs in a timely fashion is important. You should have a clear understanding of how often you will proactively hear from your advisor as well as what type of access you will have to information. In person meetings, depending upon your need, should occur no less than yearly, and in most cases semi-annually or on a quarterly basis.
It may seem like this is a difficult process, but it is well worth the investment of your time. Many people spend more time researching their next smartphone than they do talking to potential financial advisors. But the smart money is on taking your time, and really getting to know somebody who could help make your financial dreams come true.
At Magellan Financial, we can answer any of your questions. We will help develop a plan to make informed decisions by understanding your financial situation. To schedule an initial consultation or learn more about how Magellan Financial can help you plan successfully, please call us at 610-437-5650 or email us at Rob.Cahill@wfafinet.com.
Financial Industry Regulatory Authority (FINRA) guide to Choosing an Investment Professional
Wells Fargo Advisors Financial Network did not assist in the preparation of this report, and its accuracy and completeness are not guaranteed. The opinions expressed in this report are those of the author(s) and are not necessarily those of Wells Fargo Advisors Financial Network or its affiliates. The material has been prepared or is distributed solely for information purposes and is not a solicitation or an offer to buy any security or instrument or to participate in any trading strategy. Additional information is available upon request.
Investment products and services are offered through Wells Fargo Advisors Financial Network, LLC (WFAFN), Member SIPC. Magellan Financial, Inc. is a separate entity from WFAFN.