female advisor raising her hand in a group setting

The Financial Advisor Interview

October 11, 2018

LPL Financial

To choose the best financial advisor, ask the right questions—and assess your comfort level with the advisor and his or her answers.

Start the Conversation

Finding a financial advisor is like searching for the right candidate for a job. Experience, education, and professional credentials are important, but so is “personality fit.” Assessing how a prospective advisor’s personality meshes with yours can help in selecting someone you’ll feel comfortable working with to chart a course for achieving your financial goals. That’s why an important step in choosing a financial advisor is “the interview.”

Think About Personality Fit

Beyond getting questions answered, interviewing a prospective advisor provides the opportunity to learn about a prospective advisor’s communication style, interpersonal skills, and financial planning approach and philosophy. You’ll get a better sense as to whether or not this is someone you feel you can trust with details about your personal finances, lifestyle, family relationships, and more. In addition, you’ll be in a better position to determine if this person gives you the sense of confidence necessary for a strong working relationship.  

An interview works best in a face-to-face meeting as body language, facial expressions, and eye contact can tell you a lot about a person. However, even a phone call can help you determine if a particular advisor is right for you.

The key is to ask the right questions. Make sure the answers you receive raise both your comfort level with and confidence in choosing a particular advisor. Prepare a list of questions. Approach this like a job interview, which in essence, it is. After all, you’re someone to help you develop and implement a plan to guide your pursuit of financial wellness.

Develop Your Question List

While the following is not a comprehensive list of questions to ask, it can serve as a “thought starter” for helping you developing your own list of interview questions.

Who is your ideal client?

  • The answer will help both you and the prospective advisor determine if there’s a mutual fit.

How do you measure success?

  • A prospective advisor’s answers will tell you if your goals and interests are priorities.

How involved will I be in decision-making?

  • Make sure a prospective financial advisor is willing to work the way you prefer, whether that means you’ll be very hands-on or trust the advisor with all the decision-making.

How long have you been offering financial planning services?

  • Considering an advisor’s experience is important, especially if you have a complicated financial situation or special circumstances that may affect your needs.

How many clients do you work with yourself?

  • If an advisor is working with what seems like an excessive number of clients, you may not get the personal attention you want. If the advisor says that one of his/her associates will primarily work with you, ask to meet that person. Insist on interviewing that person as well.

Do you have clients like me?

  • You’re more likely to have a good experience with your advisor if he/she works with people similar to you in terms of asset level and life circumstances.  

Do you have a business continuity plan?

  • It’s important to know what would happen is the advisor you choose retires, passes away or transitions completely out of financial services. Ask if there’s a plan in place to address any potential situations whereby he/she might no longer be able to provide services to you.

What services will you provide and what will they cost me?

  • Find out in detail what services your advisor will provide. Also, ask how the advisor will be compensated for his or her services. Will the advisor work on a fee-only basis, charge you a fee and also receive commissions, or earn commissions only?  Make sure you understand the advantages and disadvantages of the various compensation models.

How will this relationship work? Will we meet on a regular basis or a certain number of times a year? Will we communicate primarily in person, by phone or using another method? Can I contact you any time I have questions, concerns or specific requests? Will I receive something from you in writing that outlines my financial goals and the plan for helping to achieve them? If there is a written plan, how often will you reassess and update it?

  • It's important to feel comfortable with how the relationship with your advisor will work and what you can expect.

Move Ahead

After interviewing a prospective advisor, assess the experience. Who did most of the talking? Did the advisor answer your questions clearly and directly? Did he or she use a lot of industry jargon? Do you feel comfortable with the way the conversation went? Do you feel like the person was someone you want to talk to again?

If you aren’t comfortable with the way things went, you can either give the advisor a second chance with a follow-up interview. Or, you can move on to the next advisor on your list. Once you’ve settled on a financial advisor, make your decision official. Contact the advisor you’ve selected to find determine next steps and prepare to get your financial future underway.

For more information about choosing a financial advisor, take advantage of the resources that follow. If you haven’t compiled a list of prospective advisors yet, use the LPL Find an Advisor tool to get started.

 

Resources