Perceptions of financial services professionals tend to run the gamut from “They’re all crooks, and I don’t trust a word they say” to “He or she has such an impressive alphabet of credentials after their name. Who am I to ask questions?”

Many people are nervous about interviewing a potential member of their financial advisory team. It’s easy to get blinded by technical jargon, Ivy League diplomas, and a dizzying menu of products and services that can overwhelm.

Just as some people fear questioning their physicians, they are also afraid to dive deeper with their financial advisors and agents, especially if that advisor is referred to them by a colleague or friend.

Failing to perform due diligence when choosing a financial guide can create many problems, especially as you enter retirement. A great way to begin the necessary vetting process is to put together a list of essential questions to ask your advisor candidate. Candidates must answer these fundamental questions to your satisfaction before being considered.

Here are some of what I consider to be the most important questions you should ask potential advisors before placing any business with them.

Are you a fiduciary?

Fiduciaries are people or organizations that act on behalf of other people. Fiduciaries are legally and ethically bound to put their clients’ interests ahead of their own and always act in good faith.

Non-fiduciaries, on the other hand, are only required to determine the “suitability” of the products they sell, even if those products are not optimal for your particular needs. Having a fiduciary working on your behalf goes a long way in ensuring that your money is working as hard in retirement as it did when you were still working.

What is your investment philosophy?

Depending on where you are on your money timeline, you have a mindset about money. Does the thought of losing even one cent in retirement bother you? Are you more of a risk-taker? Is “buy and hold” a part of your money strategy? Is socially-responsible investing something you want? Ask your advisor candidate to explain their investment philosophy in some detail. Discovering this philosophy will help you determine if you are both aligned when it comes to investment style.

If I could talk to five of your best clients off the record, what would they tell me about you?

While this question is a little on the philosophical side of things, the response will tell you a lot about the person you’re considering, such as the level of confidence they have in their abilities and how they view their clients.

How are you compensated?

Many people hesitate to ask this question because it seems somewhat intrusive. But you need to know how your advisor gets paid. There are many different kinds of fee structures, and many of those end up nudging advisors to push products instead of providing the best solutions.

Fee-only advisors are often the right choice when it comes to avoiding conflicts of interest.

What kinds of people do you work best with?

Knowing your candidate’s favorite client demographic is revealing on many levels. It can also help get rid of some of the friction that occurs in professional relationships. For example, an advisor who says tells you that he or she most enjoys working with young entrepreneurs may not be a good fit if you are about to retire.

How will we be working together?

You are asking the advisor to describe their process and give you an idea of how accessible they are, how often they will be contacting you, and the methods they will be using to communicate. You’ll want to discuss whether they are more comfortable working virtually or if they prefer in-person meetings.

What is your asset allocation methodology?

How an advisor allocates funds is most important if you are still in the accumulation phase of your financial life. However, it can also reveal an advisor’s attitude toward risking their retired clients’ money. Diversification is essential in any stage of your money life.

How will you coordinate your advice with my current tax situation?

You are asking this to determine if your advisor candidate has a “cookie-cutter” approach that does not consider each client’s specific tax issues. You want to know if they are prepared to give advice that coordinates well with your current tax situation.

Are you willing to work with my other advisors?

Does this financial advisor demand exclusivity, or is he or she willing to become part of a team? Do they value having the input of specialists with whom you already have relationships, such as your CPA, estate attorney, or insurance advisor? In other words, do they play well with others?

What education, training, or professional designations do you have?

There are lots of designations in the financial services world. And, there is a tendency to conflate an alphabet after someone’s name with competence and integrity. Don’t put much stock in these letters unless your advisor can explain what they mean and what was required to obtain them. He or she should demonstrate a level of advanced training, product knowledge, and overall competency.

If I did an online search, what would I discover about you, good or bad?

Good advisors know the value of a solid online reputation. By asking this question, you let the prospective advisor know that you will be checking out their online credentials.


These are just a few questions to help you get started in the vetting process. Having the right advisors on your team is a critical factor in having a safer, sounder retirement.