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So, you want to create a financial strategy? Whether it is for your children’s college, retirement planning, investment strategies or budgeting… finding a financial advisor can be overwhelming. After all, your financial advisor will know a lot more information about your finances than any other person, while helping you make major life decisions. It is important to seek out someone who is professional, will consistently communicate with you, understands your goals, and always keeps your best interest at the forefront of their strategies.


When it comes to wealth – building and planning your financial future, you cannot overestimate the importance of working with a financial advisor. I mean, if you have a toothache, you do not try to perform dental procedures on yourself. You find a competent and well-reviewed professional to do the job. After all, you do not want to be making compulsive, emotional decisions with your money. Statistically speaking, working with a financial advisor increases your savings by almost 300%.


Whether you are looking around to hire an advisor for the first time or considering if your current advisor is worth it, here are a few questions to jot down, so you are well prepared for your meeting.


1.    What is your investment philosophy? 


You created a list of potential advisors. Great!! Now, ironically not many people will ask the advisor what their investment philosophy is. But if you do, it will give you better insight as to how they’re likely to invest your money and manage your portfolio in comparison to their own. This also gives the client (YOU) an idea if the advisor is more risk orientated or adverse when it comes to financial strategies. How they allocate and diversify funds and whether growth or liquidity is more important can all make a major difference. A good mix is never wrong. It just depends on what YOU are comfortable with. What you are looking for is what we at Wealth Cap term as “true diversification”. This means that your money is invested in separate buckets that aren’t impacted each other. For instance, if Wall Street takes a tumble, you don’t want your entire portfolio to suffer. Given how many companies invest in one another, diversifying across stocks, mutual funds, and bonds might not be enough. Hence, you might ask if your advisor offers self-directed options. After all it is your hard-earned money.


2.    What services do you provide? 


Credentials, licenses, and areas of expertise are all factors that should determine the services an advisor can offer and the choice you make. Generally speaking, most advisors cannot offer certain products or services without the proper licenses or credentials to do so. With that being said, it is easy and much more reputable when an advisor can perform multiple services for their clients such as investments, long term disability planning, life insurance, estate planning, tax planning, etc. Financial Advisors can offer a wide array of services, so it is important to know what they specialize in or focus on. Life changes rapidly at times. Therefore, your plans have to keep up and stay fluid as well. Having someone who can offer various services always enhances your strategies in case of life changes.


3.    How will you measure and evaluate my performance and success?


Typically, different advisors see success differently. Some may use “benchmarks” in comparison to other products or market movements. For example, the advisor may look to “beat” the S&P 500. Or, in most instances, advisors look at your over all “portfolio performance” compared to your risk tolerance and time horizon. Choose the one that is suitable with your comfort and understanding. Take note, a downward market does not necessarily mean a lack of performance or success…if your advisor makes sure that all factors are taken into consideration when allocating your assets, diversifying products, re-balancing at proper times and leaving emotions out of the picture. Whichever way you go, you want a professional who sees the bigger picture and progress towards your specific goal(s).


4.    What extra fees should I be aware of? 


Pretty simple. In addition to paying your advisor fees, cost of products, or other fees you might face, you will want to know exactly what they all are. Most advisors charge an “asset under management” fee that is usually about 1%. That can be a significant amount depending on your overall portfolio. Furthermore, not all costs are included in the advisor’s service. For example, an advisor may charge additional fees for various services or plans created and implemented for the client (You). That is not to include things such as fund fees, brokerage fees, and/or trading fees which can all add up. My recommendation…speak up and do not be afraid to ask!


5.    How often do you communicate with your clients?


This is your money we are talking about. Would you not like to know what and how your portfolio is doing on a regular basis? Of course, expecting daily, weekly or even monthly calls at every market fluctuation and swing is quite drastic, but a quarterly call or email and possibly a semi- annual/annual review should suffice. So, keep that in mind. Most importantly, you want to build a relationship with someone who at least returns your phone calls and also reaches out to you out of courtesy.


6.    How do you get paid? 


Of course, this one cannot go unsaid. It is always of great curiosity as to how your advisor will be compensated by you. And rightly so. Outside of unexpected fees, why would you want to know how you will have to pay for compensation of service or products? Essentially, there are various ways that an advisor can be compensated: 1) Assets Under Management (AUM), commission fees for products, time-based fees, subscription-based fees, or a mix of these. Your advisor should be more than open about their compensation strategies. If not, I suggest you walk the other way.


If the answers you receive from these questions don’t meet your requirement or expectations, then keep searching. After all, you are building what should be a lifelong relationship with someone who knows the most intimate details about your finances. Remember, you are hiring someone to clarify your financial life, not make it more complicated.


If you are looking for someone or something that gives you the freedom to self-direct your investments and true diversification, then consider Wealth Cap ( If you already work with someone, then it might be time to re-evaluate the relationship if you’re still reading this. Happy journey!