When to Hire or Change a Financial Advisor

Getting serious about your finances can open up a world of thrilling opportunities as well as overwhelming possibilities. With seemingly endless investment options, differing opinions, a market that is constantly in motion, and your own evolving goals, it’s natural to need guidance. A skilled financial advisor can serve as a trusted guide on the road to and through retirement. Knowing when it’s time to engage with one or explore a new relationship is key. Let’s delve into the signs that indicate it’s time to bring a financial advisor on board or consider a change.

Signs It Might Be Time to Engage a Financial Advisor

• Feeling overwhelmed by financial management
• Experiencing major life changes (marriage, divorce, new baby, career change, or inheritance)
• Approaching retirement and need guidance on Social Security, pensions, and income strategies
• Having a high net worth and needing sophisticated wealth management, tax planning, and estate planning
• Lacking the time or expertise to manage finances effectively
• Income is over $100,000/annually

Signs It Might Be Time for a New Financial Advisor

• Experiencing poor communication or service
• Receiving advice that is too generic and doesn’t fit your unique situation
• Suspecting conflicts of interest in their recommendations
• Feeling a lack of transparency around fees
• Observing consistent underperformance of investments compared to benchmarks that your advisor cannot competently explain
• Noticing that life changes are not being addressed in your financial plan

Choosing the Right Advisor

• Verify that the advisor has a fiduciary duty to put your interests first
• Check for relevant experience tailored to your needs
• Ensure the advisor’s communication style matches your preference and that they are responsive
• Understand how the advisor is compensated (fee-only, commission-based, etc.)
• Research industry average fees for advisors with similar services and client profiles.

What You Should Be Asking

Service:

• How many clients do you have, and what is your communication frequency?
• Do you outsource any of the decisions impacting my account?
• If so, who will be making decisions on my behalf?
• What about my personal situation might influence your investment recommendations?
• Do you have an investment committee, and how frequently do they meet to stay vigilant on market changes?

Fees:

• How do you get paid for your investment recommendations?
• Are you receiving incentives in any way?
• Do some investment recommendations pay you more than others?
• What additional costs will I incur beyond your structured fees?

Ethics:

• When are you held to fiduciary standards in our relationship, and when are you not?
• Have you ever had a complaint filed against you (or your firm) with the Financial Industry Regulatory Authority (FINRA), or the Securities and Exchange Commission (SEC) or any state/regulatory agencies?

 

Utilizing this checklist can assist in making informed decisions about hiring a financial advisor or switching to a new one. This ensures that your financial well-being is in the hands of a trusted and competent professional.

Still not sure? Take the guesswork out of investing. Fort Pitt Capital Group offers a no-cost or obligation financial review and plan to simplify your financial journey. Our dedicated advisors provide personalized guidance and clear, straightforward advice to help you understand your portfolio and make informed decisions. We’re committed to helping you achieve your financial goals. Contact us today to schedule your no-obligation consultation.