Understand when you need an advisor to manage your finances and plan for long-term goals. Experienced experts provide guidance to manage your cash flow, build savings, pay debt, and prepare for retirement. You can also protect your family’s income, save for education, and make decisions at different stages of life. Your expert creates a detailed financial plan after analysing your goals and life priorities. These are some financial circumstances in which you may require professional input. Work with an advisor when you are starting your first job and understanding retirement contributions. You may also require financial planning for life changes, such as getting married, having a child, or buying your first home. Experts also analyse whether to carry debt payments or save simultaneously. Consider financial advice during these important life events:
- Starting Your First Job
- Getting Married or Having a Child
- Buying Your First Home
- Managing Debt & Savings
- Rolling Over a 401(k)
- Planning for Retirement
Recognize when you need a financial expert to achieve your long-term goals.
Types of Financial Advisors and What Their Credentials Mean
Review the types of financial advisors and their credentials before selecting a professional. Licensed expert helps you decide the type of service you require to meet your goals. You need to choose an advisor who specializes in areas where you need help. Select an expert who can evolve your financial plan as your life circumstances change. Online financial planners provide you with virtual consultations at a medium cost range. Robo-advisors provide you with digital investment management services at lower costs. Traditional financial expert offer in-person services and manage your complex financial situations. Review whether your advisor upholds fiduciary duties and works in your best interest. You can check expert credentials such as Certified Financial Planner (CFP) or Registered Investment Adviser (RIA). Consider these factors before choosing:
- Professional Credentials & Background
- Fiduciary Responsibilities
- CFP Certification
- RIA Registration
Review your advisor’s credentials, background, and fee structure before hiring.
How Financial Advisors Get Paid and What They Cost
Review how financial advisors get paid and what they cost. Financial advisor fees vary based on the services, assets managed, and payment structure. Some advisors offer you plans with flat fees, an annual retainer, or hourly. Assets under management (AUM) is the most common pricing method, where advisors charge a percentage of your investments. For example, a 1% AUM fee on your $1 million portfolio costs $10,000 annually. You can choose hourly planning services, which cost $307 per hour or $2,926 for a one-time engagement. Commission-based expert will earn money from your investment transactions. These commissions range from 1% to 6% of your transaction amount. You can even hire fee-only expert who receive compensation without earning commissions. Review fees based on AUM:
| Investment Portfolio | Annual AUM Fee |
| $500,000 or Less | 1.50% |
| $500,000 – $1 Million | 1.25% |
| $1 Million – $3 Million | 1.00% |
| $3 Million – $5 Million | 0.75% |
Check how financial expert get paid and what they cost before contacting them.
Where to Find a Financial Advisor
Find a financial advisor who offers services that match your needs. Review your financial planning priorities and determine what type of professional service you require. Financial experts offer services such as budgeting, debt management, insurance, retirement planning, investment management, tax, and estate planning. You can find a fee-only advisor using the National Association of Personal Financial Advisors (NAPFA). NAPFA is a professional trade association of fee-only financial expert who follow a compensation model. Choose NAPFA-affiliated advisors, as they follow the organization’s Code of Ethics. Create a list of what you need help with before contacting an expert. Review the professional background to select an expert matching with your long-term goals. Select an expert whose services align with your long-term goals.
Questions to Ask Before You Hire an Advisor
Ask questions to evaluate a financial advisor’s expertise and responsibilities before hiring. Financial expert offer an initial meeting to discuss your needs and understand their services. You can ask whether a fiduciary advisor is legally required to act in your best interest. Understand how your expert receives compensation and request a written fee schedule. Ask your expert if they are registered with a broker-dealer or licensed to sell products. Review professional credentials, such as CFP, CFA, CPA, or ChFC, to know qualifications. You should also ask about their investment philosophy and how their strategy works in market declines. Ask these questions before hiring:
- How Do You Get Paid?
- What Are Your Total Fees and Costs?
- What Qualifications and Certifications Do You Hold?
- What Financial Planning Services Do You Offer?
- What Is Your Investment Philosophy?
Prepare a list of questions to ask a financial advisor during an initial discussion.
In my 32 combined years of servicing clients I have found that so many people find themselves wondering who they should trust with regards to getting advice and services.
With so many options and different opinions to try to comprehend, it is no wonder that so many people get “paralysis by analysis”.
When we as people don’t have clear a direction with whom we should place our trust in, we grow
frustrated, attempt to master techniques beyond our own experience/understanding, and in some cases, not work with anyone at all.
In this day and age there are a plethora of companies that offer similar services and products, and all of them claim to be the best! Well, I am here to tell you that there are 7 C’s to consider when deciding who you should work with.
#1 C-COMMUNICATION
This is #1. Finance and Fitness can be complicated topics. When choosing the best advisor for yourself and your family, communication should be a pre-requisite.
When I say communication, I am not referring to the advisor who talks over your head in terms that you don’t understand and sounds sophisticated or smart!
I am not referring to the witty advisor who can make jokes. I am talking about the advisor who actually asks good questions and more importantly “listens.”
An expert advisor should be experienced enough to dig deep into what your needs are in order to be able to give you a good, sound recommendation. The advisor should be more concerned around understanding your “why,” vs their own incentive. Also, that advisor should be able to communicate to their clients as a teacher and educator.
As a client you will find peace of mind working with the advisor who can explain why they are making a certain recommendation and how you will benefit from it.
#2 C- COMPASSION
This one ranks pretty high on my list even though it can be hard to determine during the initial interactions. The best definition I have found on compassion: the emotion that we feel in response to the suffering of others that motivates a desire to help.
Your advisor should have a burning desire to “help” and not a desire just to make money. So, ask your advisor, “Why did they became an advisor?”
I learned something when I was a High-School teacher years ago. I was the youngest teacher in the entire school, yet I never had issues with the behavior of my students. I attribute that success to one thing: my students knew without a doubt that I cared about them as individuals. I was not there just to collect a paycheck.
Even when some of my students were on the verge of failing my class, I was there to help them navigate through the issues that were distracting them at home. Now understand, I am no way suggesting that advisors work for free; everyone deserves to be compensated for their expertise. I would suggest this: make sure your advisor is passionate about helping people and not more concerned about generating commission.
#3 C-CUSTOMIZATION
This C is dedicated to my friend, Gary Jones, with Jones Select Custom Clothier. One Size DOES NOT FIT ALL. This is also true for fitness and finance. Nothing is more frustrating than seeing professionals trying to fit all of their clients into one particular model.
Where is the value in this? It would be similar to purchasing investment and health advice off of the rack! Your program should be customized to fit you like a suit. We are all unique and so are our situations. So your plan should be customized to fit your needs.
Now granted, some things are going to be a constant in all plans like cardiovascular exercise is to a fitness plan, stocks/bonds are to a financial plan, and a belt is to a suit. So a good question to ask your advisor is, “What is unique about my plan? How is this customized for me?”
#4 C-COMPETENT
Quite simply, does this person know what they are doing? How can you determine this one?
What certifications or licenses does this person have? How long have they been in the business? What do their other clients have to say about them?
In defense of the newer, less experienced advisors out there, I am thankful to the clients who put their trust in me when I was first getting started in the health/wealth industries. So if you are considering working with someone who is newer to the industry, look at their character and learn about their previous success. Those past successes may be an indicator of how well they will work for you.
#5 C-CAREER
OK. I’m going to say this. This is important! When identifying a health or wealth advisor you want someone who is planning on doing this as a career. This is important because there is nothing more important that your physical/spiritual health. Your financial wealth runs a close second.
Due to the fact that these areas are of such importance, you should consider working with the individual who makes giving advice a career decision. People change “jobs” all the time, but how often do they change “careers?”
Find the advisor who shows some consistency in their career path.
#6 C-COSTS
I know you are wondering why this is so low on the list! Often, prospective clients lead in with, “How much is this going to cost me?”
So here is the bottom line. Advice and services come at a cost. Be prepared that if you want a quality service that there will be some cost associated with it. To put this into perspective, don’t be cheap when it comes to your health or your wealth.
They are too important. Also, make sure you are crystal clear on all of your costs. Wealth and Health industries are highly competitive you will find that after all costs are disclosed, there isn’t much difference from one company to the next.
Advisors want your business, so it is unlikely that they will price themselves out of the market. Lastly, costs are only an issue in the absence of value. There is nothing wrong with asking your prospective advisor why they charge what they do and what value you are you receiving as a patron. That is a more than fair question!
Look into working with an Independent Investment Advisor Representative. You may find that working with an Indepedent advisor vs working with a Big-Firm Advisor may have some benefits to you.
#7 C- COMPANY
Lastly, the company. With so many companies offering similar/same products or services, you want to make sure that the company is compliant with regards to their regulating bodies.
In short, just confirm that the companies are regulated. All legitimate companies have to report to some entity. I’ve listed this as the final “C,” because once it is confirmed that the company is in good standing, the rubber meets the road with the personal relationship that is established between you and your personal health or wealth advisor.
You can also look your Advisor up on Broker Check to see their past work history and get a grasp of their financial matters. This will give you a quick snap shot, but always ask the Advisor directly about their report. Their experiences may serve as a benefit to you.
“Phy-nancially Fit LLC looks to impact the lives of Entrepreneurs and Individuals by showing them how to increase their income, energy and efficiency by creating customized financial, wellness and growth plans, so that they can one day retire Healthy and Wealthy.”
Perry currently Holds a Series 7 License (Securities License), Series 66 License (Investment Advisor), Life / Health / Annuity Licenses (Insurance License), has a CRPC (Chartered Retirement Planning Counselor) Designation through the College of Financial Planning and is Currently working on the CPFA (Certified Pension Fiduciary Advisor) Designation.
In the areas of fitness, Perry has held the CSCS (Certified Strength and Conditioning Specialist) certification through the NSCA (National Strength and Conditioning Association) and still holds the PES (Performance Enhancement Specialist) certification through the NASM (National Academy of Sports Medicine).
In addition, Perry is also a member of the John Maxwell Global Leadership Team. He has earned the certification of an Independent Personal Finance Speaker, Coach and Trainer with the John Maxwell Team. He specializes in corporate leadership training, sales, and coaching entrepreneurs. Learn what a Personal CFO can do for you.