Personal Finance

The 6 Most Important Questions to Ask a Financial Advisor Before Hiring Them

Maurie Backman

Published: February 22, 2025 9:21 am

Hiring a financial advisor is something a lot of people don’t think to do. But in reality, it could be an important step toward meeting your financial goals.

But you don’t want to hire any old financial advisor. It’s important to find someone who’s a good match for your needs. With that in mind, here are a few important questions to ask a financial advisor before giving them your business.

1. What qualifications do you have?

There are professionals out there who know a lot about investing and financial decisions. But that doesn’t make them qualified to be a financial advisor.

Before you sign on with anyone, ask about their qualifications. Common licenses and designations you should look out for include Certified Financial Planner (CFP), Chartered Financial Analyst (CFA), and Chartered Financial Consultant (ChFC).

2. How much experience do you have?

Someone who gets their medical degree and fulfills their training requirements may be perfectly authorized to perform surgery on you. But if it’s their first day on the job, are they going to be your top choice?

Similarly, you may want to choose a financial advisor who has at least a few years of experience working with clients. Or if you’re going to use someone who’s brand new, ask them whether there’s a senior partner they work with to consult on complicated matters.

3. What investment strategies do you recommend for me?

Although you don’t have to share every single detail of your personal journey and goals with a financial advisor during an initial meeting, they should have a sense of what you want. From there, don’t be afraid to ask them what specific investment strategies they have in mind for you.

And if they start using lingo you don’t understand, ask them to clarify. If they can’t, it’s a sign that they may be the wrong person for the job. Just because you’re hiring a financial advisor doesn’t mean you want to be left in the dark about where your money is going.

4. What fees do you charge?

Financial advisors deserve to make money, just like you wouldn’t work for your employer without a paycheck. But it’s important to understand how any financial advisor you might work with gets paid.

Some financial advisors charge a fee that’s calculated as a percentage of assets under management. You may be looking at 1% or more, depending on the size of your portfolio. So if you have a financial advisor who charges 1% manage $500,000 in assets, you’re looking at an annual fee of $5,000.

Other financial advisors, meanwhile, charge a flat or hourly fee. There are pros and cons to each setup, but either way, it’s important to know what costs you’re looking at.

5. How often do you typically meet with clients?

You probably don’t need or want to meet with your financial advisor every month. But it’s not a bad idea to have quarterly check-ins so you can review your progress and talk through strategies.

Before you hire a financial advisor, ask how often they meet with clients. If their answer is once a year, you may want to find someone who’s more hands on.

6. Are you a fiduciary?

It’s possible to work with a financial advisor who isn’t a fiduciary. But you should know that a fiduciary has the obligation to put your best financial interests ahead of theirs at all times.

That’s important, because if a financial advisor is not a fiduciary, they’re allowed to recommend investments that are suitable for you, but perhaps not the best, to earn a larger commission. And that could end up costing you money.