When selecting a financial advisor, make sure you know more than just their name and professional credentials. Here are some guidelines.
The first step is to decide whether you want to work with a fee-only financial advisor or with an advisor that is paid by commissions. You will also need to decide if you are comfortable working remotely (via telephone and email) with a professional located somewhere around the world or if you would prefer working with someone in your own community with whom you can talk face-to face.
To understand the differences better, see Why Fee Only?
In addition, be sure to:
1. Use FINRA BrokerCheck to make sure that the investment professional and his or her firm are properly registered.
2. Talk with several financial professionals. Ask about their:
- Registrations, licenses and professional credentials
- Areas of specialization
- Products and services
- Investment experience
3. Understand how the financial advisor will be paid. Fee-only investment professionals are typically paid in one or more of the following ways:
- An hourly fee
- A flat fee
- A percentage of the value of the assets they manage for you
- A combination of the above