15 Essential Questions to Ask a Financial Advisor When Planning Your Retirement

Looking for a financial advisor to help you with your retirement? Sometimes it can seem even more difficult than buying a house or a car. Learning how to make money can seem like a scary thing to get your head around.

However, a few simple questions can help you determine if your financial advisor is right for you. Below are the top 15 questions to ask a potential financial advisor.

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1. What is your financial philosophy?

Money is a personal thing, and hopefully you’ll have a relationship with your financial advisor that lasts for years. That’s why it’s important to determine if you’re an ideological fit.

It’s okay if your philosophies differ a little—it could be a learning opportunity for you—but to trust your advisor, you want to be on the same page about some important things.

2. What services do you provide?

Different financial advisors offer different things. If you need special services, make sure the consultant can provide them. Depending on your needs, you can ask about:

  • Tax planning

  • Insurance coverage

  • Budgeting advice

  • Estate planning

  • Debt management

  • Retirement planning

3. What professional documents do you have?

Each financial advisor will have specific qualifications. Look for respected industry designations such as Certified Financial Planner (CFP) or Chartered Financial Analyst (CFA).

In order to sell or recommend certain products, an advisor may be required to pass licensing exams from the Financial Industry Regulatory Authority, commonly known as FINRA. He or she may also need to be registered in the country.

4. Who is your typical customer?

Look for an advisor who has experience with clients in situations similar to yours. For example, if your focus is retirement planning, make sure your advisor has helped clients plan for their golden years.

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5. Are you a confidant?

Some people prefer to make sure their financial advisor is a fiduciary. This means that the adviser is required by law to always act in your best interests.

There are many non-fiduciary advisors who do good, ethical work. However, choosing a fiduciary can give you additional peace of mind.

6. How do you make money?

Financial advisors can use a wide range of payment structures. If you choose an advisor who pays a commission, he or she may direct you to a product that is not the best for your needs.

Instead, you may want to choose a fee-for-service advisor. If you’re choosing a fee-only financial advisor, find out if the fee is a percentage of your assets or if it’s a flat fee.

7. Will you provide information about your fees in writing?

If you want to be extra careful, ask your financial advisor for a written list of all fees and expenses. This way you can avoid unpleasant surprises. Your financial advisor should understand your desire to be ‘better safe than sorry’.

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8. How will we communicate with each other?

Communication is a key component of any professional relationship. This is especially true for money. So make sure you are comfortable with the way the advisor communicates.

Will your financial advisor primarily call you or will you receive messages by email? Or maybe your advisor prefers to meet in person. Find out and make sure it fits your communication style.

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9. How much money do I need to retire?

For most people seeking financial advice, this is a golden question. There is no “right” answer here, as experts have many different theories. But your financial advisor should be able to give you a rough estimate and then explain how he or she arrived at that number.

Do you have other personal financial goals that need to go along with your retirement goal? Your financial advisor should also be able to help with this.

10. When can I retire?

Now that you know how much money you’ll need to retire, it makes sense that you’ll want to know when you’ll be able to get there.

There is no exact answer to this because future returns are unknown. But your financial advisor should be able to tell you what your retirement timeline looks like based on your specific situation

11. When should I apply for social security?

Deciding when to file for Social Security benefits is tricky because the age you choose will affect the size of the monthly check you receive. It’s easy to find general advice online, but your financial advisor should be able to make recommendations tailored to your needs and goals.

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12. Do you offer any educational resources?

Different people will have different opinions about how involved they want to be with their financial advisor. If you’re someone who wants to learn as you go, ask potential financial advisors about how much they offer in terms of educational materials.

13. What taxes can I pay in retirement?

Some people don’t consider taxes in their retirement plan, leaving them in for a nasty surprise later. Your financial advisor can help you prepare for the taxes you will face in retirement.

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14. What do you think are the biggest risks I face in my retirement?

One of the most powerful parts of financial planning is keeping track of your risks so you can create contingency plans. When you ask an advisor about the risks you face, you understand how carefully the advisor pays attention to your current financial situation.

If you’re putting your retirement in the hands of an advisor, you want to make sure he or she is keeping a close eye on the current and future risks you face.

15. What will we do if I don’t reach my goals?

In an ideal world, all financial advisors would provide a plan guaranteed to help clients achieve their goals. However, the world we live in is not perfect.

Your financial advisor should be able to offer you transparency about what he or she will do if you do not successfully meet our financial goals.

The bottom line

If you’re not sure where to start on your financial advisor journey, you can find a wide range of reviews online. However, it’s never a bad idea to ask friends and family for their personal experiences—sometimes recommendations are the best way to steer you in the right direction.

Once you’ve found the right professional, you’ll get expert help to save for retirement, learn how to avoid financial stress, and reach your other financial goals.

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