Image via Wikipedia
If you have made the decision to hire a financial advisor then you probably have some idea of what you would like help with and what type of services you are looking for. However, you will be trusting this person with your hard earned money and you need to make sure that they know what they are doing. So here are some questions you should ask to make sure that you understand exactly what you will be getting from your financial advisor.
The first thing you need to ask is what they charge and how they get paid. There are several different methods from which planners can make money. First, they can ask for a straight fee which you pay when working with them or they can be paid from commission. If they ask a fee, you need to determine if it is a fee paid by the hour or annually for working with them and determine if the fee sounds reasonable. If they are paid by commission for selling some kind of savings plan then they are more likely to try to get you to do something that will make them money even if it not best for you.
You also need to ask about their credentials. Can your planner show you a college or graduate school diploma that shows that they have some experience working with money? You should also ask how much experience they have. It is never rude to ask people about their experience in an industry. After all, you are entrusting them with your money. They should also be able to provide you with references if you require them. If they cannot, then that might be a red flag.
