Today, I’d like to tell you just what you should be asking your financial advisor when getting your account started so there’s less confusion for you down the road. 

The most important thing to remember when choosing a financial advisor is: are your needs being met? Does this advisor offer everything you want? Do they steer away from things you don’t like? Are you confident in them to handle your money? Make sure your needs are met! 

Question #1: Fees

What are your fees and how do you charge them? Different advisors may have different rates as well as how they get paid. You may have a fee-based advisor who will charge a percentage of the assets they run, or you may have an advisor who charges by the hour regardless of your assets!

Always ask about advisory fees as well as any fees in the fund they will be using to invest for you. Also consider trading fees and management fees. 

Question #2: What am I getting?

This one is short and sweet: what am I getting for the fees that I’m paying? Be sure the amount you are paying lines up with what’s being done for you!

Question #3: Are there any more fees?

Advisors may not be jumping to tell you exactly what kind of fees are associated with the investments being made. Some may recommend what is called an A-Share or a B-share, meaning you pay a certain percentage to get into a fund. 

There are many great options that don’t require fees, so if your advisor is leaning toward one with a fee don’t be afraid to ask why they are choosing it! 

Question #4: How often will we talk?

It’s important to know when you can expect to hear from someone regarding your money and it’s management. They may communicate monthly, annually, or quarterly! Knowing when you can expect to receive updates is important, plus it could show you that you need to find a new one if you aren’t hearing from your advisor. 

Question #5: So what do you do?

Some financial advisors may only offer portfolio management, whereas some may offer financial planning! A portfolio manager will only manage your investments such as making sure you are properly invested, allocated, and diversified! A financial planner will go a few steps beyond and start running retirement calculations to help you plan financially for your future as well as retirement. 

Question 6: What’s the risk?

How much risk am I taking on in my portfolio? Should I take on more or should I invest more conservatively? Your financial advisor should be able to guide you in the right direction.

Newer investors may want to go more conservative out of fear of losing, but you could actually be shorting your money an opportunity to grow! If you’re close to retirement then you could be taking on too much risk and possibly lose some money that you were counting on! It’s worth taking the extra time to understand how conservative or aggressive your investments are and how that will play out in the long run.

 They should be able to tell you that if the market were to drop X%, your portfolio would still be worth X. It may seem confusing, but it’s important to make sure you’re doing what you need to be doing and you know what’s going on with your money.

• 7. If the stock market drops, what are you planning to do?

Question 7: So what if it drops?

Make sure you’re clear on what to expect if suddenly the market drops. What will they do? Will they be in touch? Is there anything you need to do?

Asking questions can seem intimidating when you’re new to investing. Don’t be scared! The right financial advisor will have answers to all of your questions.