Why You Need a Financial Advisor and How to Pick the Right One


Your financial health isn’t something you should take lightly; it’s incredibly important to your overall well-being and success in life, and this means that you should be proactive about your money and do what you can to make sure you’re on the right track.

While everyone has their own preferred method of managing their finances, there are some things that anyone would benefit from—things like having a budget and an emergency fund, for example—and if you don’t have the time or expertise to manage these things yourself, it’s worth looking into hiring a financial advisor to help you out.

Which type of advisor do you need?

Do you need tax help, investment advice, business consulting, or other financial advice? Knowing which of these services you’ll need can help you narrow down your search for an advisor. There are three main types of advisors: accountants, lawyers and financial planners. A CPA (certified public accountant) or EA (enrolled agent) should be able to advise on taxes, while an attorney will be able to help with contracts or incorporate your business.

Things to consider when picking a financial advisor

-Are they licensed? -What certifications do they have? -Is their company appropriately capitalized? -How long have they been in business? -What is their experience level? If you have any questions after meeting with a financial advisor, don’t be afraid to ask.

The more information you know about your situation, goals, and what you want out of an advisor (there are several types), the better off you will be in choosing someone who fits your needs.

Questions to ask before hiring an advisor

If you are looking for financial advice, talk with multiple advisors before making your choice. Some questions you should ask include


1) What is your fee structure? Are there any additional fees that I will be responsible for?

2) Can I get a copy of all my account statements from my current investment firms so that I can compare them to yours?

3) What do you think about investing in ETFs (exchange-traded funds)?

4) Do you have any conflicts of interest? For example, do you sell investments or insurance products or both?

5) Will my money be invested using buy-and-hold strategies or will it be actively managed by someone who trades frequently in an attempt to beat market averages?

What should you look for in an advisor?

It’s difficult for even an experienced investor to pick up all of these pieces on their own, so finding someone who can hold your hand along each step of your journey is essential. Here are a few qualities you should look for in an advisor.

Some Dos and Don’ts when interviewing potential advisors

Do ask how many years of experience they have. Inexperienced advisors may not know what questions to ask you or your financial situation, which can lead them to make bad decisions. Always choose someone with more than five years’ experience who has been licensed by their state since day one.