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Should I Get a Financial Advisor? Part 2

Investing & Assets

In the first part of this series, we looked at the overall benefit of hiring a financial advisor and determined that most people would benefit from hiring one. Since financial advisors can manage nearly all aspects of money and finance management, there is a good chance you would benefit...

In the first part of this series, we looked at the overall benefit of hiring a financial advisor and determined that
most people would benefit from hiring one. Since financial advisors can manage nearly all aspects of money and
finance management, there is a good chance you would benefit from an advisor.
In our conclusion to this series, we’ll look at:
1. Questions to ask a potential financial advisor.
2. Possible drawbacks to hiring a financial advisor.

What Should I ask a Potential Financial Advisor?
To quickly rehash what we covered in the first installment:
 Asking for your potential advisor’s credentials is critical. Chartered Financial Analyst (CFA), Certified
Financial Planner (CFP), or Certified Public Accountant (CPA) are all great certifications that signal the
advisor is tested and proven. If they don’t have any of these certifications or other professional
credentials, chances are you’ll have more success with one that does.
 Ask whether they’re fiduciary, which means they’re legally obligated to work in your best interest.
 Ask what their pay structure is. If they’re commission-based, be wary of the advisor advocating for
products you may not need. If they’re fee-based, though, they generally have additional incentives to
perform.
These cover the bare-bone basics to ensure you don’t get scammed, but what else? There are many questions to
ask to ensure you get a quality advisor beyond the bare minimum expectations.
What are the total costs? This can be somewhat confusing. A small percentage fee structure might sound
tremendous but ask the advisor to spell it out for you in real dollar terms. Fees can hide in many places, so getting
an “all-in” cost can be helpful to ferret them out.
For example, many actively managed funds have expense ratios; these are administrative fees deducted from your
returns, so you don’t notice them missing. A high expense ratio could mean thousands of dollars “lost” over your
investment’s timeline that you’d never realize was “lost” if the advisor doesn’t explain it in real dollar terms.
Advisory fees, annual fees, front-end loads, administrative fees – find out all of them that apply and how they
relate in real terms.
What does the client relationship look like? At baseline, you’ll need to know when to expect an update on your
portfolio, whether in person or sent digitally. This is generally quarterly, but make sure the advisor has a recurring
schedule to work with you, update your progress, and adjust plans as necessary.
More importantly, though, is finding out how easy it will be to contact the advisor in an emergency. Market
crashes, family emergencies, winning the lottery – all of these, and more, have massive impacts on your financial
profile. Your advisor must be accessible and responsive to your needs outside planned get-togethers.
What is their investing ethos and strategy? At the bare minimum, ensure that the advisor’s overall outlook
matches yours and your risk profile. If you’re a few years off from retirement, don’t find the stock jockey ready to
put it all on black. And vice versa, if you’re decades from retiring, you’ll want an investing philosophy and strategy
that leans into risk. You’d like things to be based on your needs!
When you use Diane Money, you’ll give the app an overview of your current assets and debt. From there, you’ll
work together with Diane to determine your financial goals, no matter how lofty or small. Diane will then help you,
over time, pare back unnecessary spending and keep you updated on your progress towards meeting those goals.
It’s like a constant financial expert friend in your pocket; she’ll even remind you about upcoming bills! Even if the
idea of leaving your investments in the hands of AI turns you off, Diane Money is a fantastic option to get on the
path to financial freedom and remain there.
Conclusion
We’ve covered much ground in this series, and by now, we’ve answered:
 Should I get a financial advisor?
 What do I look for when choosing a financial advisor?
 What services does a financial advisor provide?
 What should I ask a financial advisor?
 What are the downsides to hiring a financial advisor?
 What about robo-advisors?
We focused a lot on financial advisors, but don’t forget that advisors offer a full spectrum of
financial services. If you’re looking for help crawling out from under debt and planning a future that meets all your
financial goals… Diane Money is the best choice for you!

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