Choosing the Right Financial Planner

Choosing the right financial planner is a very important decision. Hopefully, your choice will lead to the start of a healthy relationship that will last a lifetime. In fact, your financial planner can be instrumental in assisting with your loved one’s needs when you’re gone. Not to make a mountain out of a molehill but choosing the right professional to work with regarding your financial health could impact not only your daily life, but your legacy and the lives of those who are closest to you. So, where do you start? 

What Licenses Does Your Potential Planner Hold? 

Not all financial licenses are created the same. Unfortunately, it doesn’t take much to hold yourself as a financial planning expert to the public. So, first and foremost, ensure the person you are thinking of working with is in fact licensed. Next, ask them what licenses they have. Most planners will have either a series 6 or series 7 license. Planners who have a series 6 will be limited in the investment vehicles they can utilize compared to the series 7. This is important to understand as it may handcuff your options if choosing to work with a series 6 licensed professional. The same holds true for planners without an insurance license. Carrying an insurance license allows your financial planner to incorporate protection into your financial plan. If you are looking for someone who has as many tools at their disposable as possible, you will want to seek out a series 7 and insurance licensed financial advisor.  

How Old is Your Financial Advisor and Their Team?  

As I mentioned earlier, the hope is that the relationship you form with your advisor will last more than your lifetime. If your advisor or your advisory team is on the older side, they could be retiring before you. This could lead to confusion or lost opportunity as you are forced to find another professional to work with when they are gone. That said, age can mean wisdom in this industry. Ideally, you will work with someone who has experience and has been through a few market cycles, but also has a plan for the future to ensure you are taken care of should something happen to them or they retire. This industry is very much about relationships and anticipating needs, so you should seek out someone you can work with for the long term and who can get to know your family and the next generation to ensure those you care about are taken care of. 

Does Your Financial Advisor Understand the Tax Consequences of Your Investments? 

This question is often overlooked. The best investment before taxes could be a terrible investment after taxes. If your advisor and CPA or tax professional are two different people, there can be oversight and lost opportunities. Ideally, your financial advisor will be familiar enough with the tax code and your unique tax situation to choose investments that compliment your unique tax circumstances. If not, it’s very possible you could be put in investment vehicles that, while at first seem great, are not the best option for you. 

Independence 

Finally, is your planner independent? This is crucial. The last thing you want is your advisor pushing you into an investment vehicle that may not be best for you because they are being told to push that product. While not very common these days, it is still worth pointing out that this could be happening