Financial Planning

Understanding the Role of a Financial Advisor

A financial adviser can help you take those next steps in your financial journey. Whether getting started with a plan or taking your finances to another level it's important for your family's future.

10 Things to Know Before Hiring a Financial Advisor

Ready to take charge of your financial future? Whether you're just getting started, or you want to take your financial plan to the next level, it may be time to hire a financial advisor or coach. That step could be an important investment in your family's future. And, just like every other investment, it's important to do your homework to ensure a successful return. Below are the top 10 things to know before hiring a financial advisor.

  1. Know what you need. Not every financial advisor is the same. Some have a vast knowledge of the investing, while others specialize in retirement savings, college savings or making the most of your Social Security income. Find out each financial advisors' specialty and make sure it aligns well with your needs.
  2. Ask detailed questions. Don't hire a financial advisor until you ask them enough questions to validate their experience and expertise. These questions can range anywhere from where they got their degree, to their legal background dealing with government regulators.
  3. Understand that you are a team. A financial advisor is not a manager who tells you what to do. Be prepared to collaborate and to contribute your own ideas as part of the financial planning process. Your financial advisor is a partner/teammate in your financial future.
  4. Trust is key. The number one downfall in any professional partnership revolves around a lack of trust. Pay attention to your instincts and check references. Choose a financial advisor who is not only qualified, but who is also authentic and trustworthy.
  5. Be aware of whose money matters most. If your advisor cares more about his or her paycheck than yours, get out. Remember, you are hiring this person to bolster your financial team - not vice versa.
  6. Identify areas of conflict in interest. Your financial advisor should readily discuss the compensation he or she will receive from the investment, as well as potential risks/rewards and how well investments align with your overall financial goals. If a financial advisor steers clear of these discussions, consider it a red flag.
  7. Be objective. We all want to live and love in this world, but when choosing someone to help direct your financial decisions, you have to analyze who is the best. Carefully assess the strengths and weaknesses of potential candidates.
  8. Remember: If it sounds too good to be true … it probably is. We all want to make a lot of money, but use discretion with advisors promising massive amount of gain.
  9. Ask what they charge. After you do your research, make sure that you clarify every cost associated with each advisor that you interview.
  10. Know the advantages and disadvantages. Having a financial advisor isn't for everyone. Know the advantages and disadvantages up front, and carefully establish expectations about the level of service you expect.

The final word: This is a big decision that deserves some time and thought. Do plenty of research, know what you want to achieve, and understand that this is a partnership. Choose your financial advisor with the same scrutiny you apply to buying a new car!

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All Learning Center articles are general summaries that can be used when considering your financial future at various life stages. The information presented is for educational purposes and is meant to supplement other information specific to your situation. It is not intended as investment advice and does not necessarily represent the opinion of Protective Life or its subsidiaries.

Learning Center articles may describe services and financial products not offered by Protective Life or its subsidiaries. Descriptions of financial products contained in Learning Center articles are not intended to represent those offered by Protective Life or its subsidiaries.

Neither Protective Life nor its representatives offer legal or tax advice. We encourage you to consult with your financial adviser and legal or tax adviser regarding your individual situations before making investment, social security, retirement planning, and tax‐related decisions. For information about Protective Life and its products and services, visit www.protective.com.

Companies and organizations linked from Learning Center articles have no affiliation with Protective Life or its subsidiaries.

Financial Advisor

When creating a financial plan, you should consider your life insurance needs, retirement savings and college savings needs while ensuring you've also made allowances for an emergency fund. A financial advisor can help in this process. Remember, hiring a financial advisor is a big decision that deserves time and thought, so be sure you do plenty of research.

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