So, you’ve determined that you need assistance handling your finances. So, what’s next?
The good news is that you have a lot of choices for getting financial advice these days. The bad news is that you now have a lot of choices for getting financial advice. When it comes to making this critical decision, you are confronted with an abundance of options, even an overabundance. You can select a local advisor, work with one around the country through the internet, or use an all-digital service known as a robo-advisor. The level of quality and resources available, as well as the price you’ll pay and advisor compensation structures, differ widely.
DETERMINE YOUR NEEDS
Before you begin your quest, take a step back and evaluate your own objectives and requirements. Pose the following questions to yourself: What are my goals and objectives? Do I have a specific goal in mind, such as retiring? Or do I have many, conflicting goals outside of retirement, such as saving for a child’s college education, purchasing a first or second home, or repaying student loan debt? Is it better for me to have a financial checkup or get ongoing advice? Do I need a more in-depth review of my savings, a retirement drawdown strategy, tax advice, or estate planning?
Identifying whether your needs are basic or complex (or somewhere in between) will assist you in determining the degree and complexity of services you need. For example, if you need help investing an inheritance, a one-time consultation with an advisor can be sufficient. You can benefit from a partnership with an advice provider if you have several goals and lack the time and willingness to manage your finances on your own.
DO RESEARCH
The next move is to create a list of possible advisors. Make a big net. Many people begin by asking friends, family, or coworkers for recommendations. But don’t just take your old roommate’s advice for a golfing buddy or pickleball partner; your old roommate may have no idea about the credentials of a good financial advisor, or whether or not an advisor is even a good fit for your needs.
You will broaden your pool by approaching other practitioners with whom you collaborate. (For example, I found an estate attorney through a referral from my accountant.) A web search is also a viable choice. Use a professional organization’s software, such as the Certified Financial Planner Board of Standards, Inc., the Financial Planning Association, or the National Association of Personal Financial Advisors, or use your own search engine.
EVALUATING ADVICE SOLUTIONS
What qualities do you seek in a financial advisor or robo-advisor? You’ll want to look at blogs, call people, and look for other resources. A client relationship description is particularly useful (or Form CSR). A CSR detailing facilities, fees and expenses, disciplinary history, conflicts of interest, and other information is needed of all registered investment professionals (and firms).
