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Wall Street Steward Blog

How I Would Choose A Financial Advisor

In the last blog entry, we covered how to know WHEN you should start investing.  The next question to cover is “WHO should I choose to help me with my investing needs?”

Most articles on choosing an advisor focus on providing you, the potential investor, with a checklist of questions to ask someone like myself about how we do business, our beliefs, etc.  Although I do agree that the best way to learn about an advisor is to ask questions, my recommended list of questions might surprise you. 

Most advisors are very skilled salespeople with experience in answering questions.  Usually, we will repeat your question back to you (to give us time to think), then craft an answer that will sound very smooth while finishing with a follow up question of our own.  Most advisors have heard all of the questions on these lists before and have a “go-to” answer for each one of them.  Asking these questions will likely waste your time, and it will provide very little insight.

In my opinion, the only true way to test a polished salesperson is to ask open-ended questions at the most inopportune times.  This forces us to respond to a question with sincerity since it is an “off the cuff” answer and NOT a pre-programmed answer.  I would wait until the advisor is trying to explain something to you, and then launch into some of the following questions:


  • Why are you qualified to manage my money?

  • What is your biggest weakness as an advisor?

  • How do you make sure your interests take a back seat to my interests?

  • What is the worst experience you have ever had with a client? 

  • Have you ever had a complaint from a client?  How was it resolved?

  • Why do you choose the investments you choose for clients?

  • What investments do you own personally? 

  • How many times have you moved firms and why?

  • What was the worst investment you ever recommended to a client?

  • Why should I choose you over the advisor down the street?  Why are you any different?

I could go on and on, but that should give you a good start.  Once you pose one of these questions, listen to the answer and also WATCH for non-verbal communication.  It has been estimated that only 7% of communication lies in the actual words spoken, which means that everything else matters more!  The look on their face, their tone of voice, the speed of the answer, etc. will all show their level of sincerity.

If an advisor will submit themselves to these types of questions and answer each one of them honestly and without a script, then you might have yourself a “keeper.”

Or, if this all sounds too difficult and time consuming, just call the guy at Family Trust.

Creative Commons License photo credit: h.koppdelaney