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A Guide to Finding Your Financial Advisor

When do you need a financial advisor?


The role of a financial advisor has evolved tremendously over the past 20 years and you may not even realize how a financial advisor can be invaluable to you today. The financial professional of years ago usually played one of two roles: A commissioned broker who helped you with an investment portfolio by suggesting investments to you or an investment manager that took over your portfolio and managed your investments without regular interaction other than a quarterly report and perhaps an annual in-person meeting. These descriptions may sound a bit extreme, but historically, financial professionals helped with investments and offered little advising. Today’s advisors may see your investments as the center of a discussion, but they also offer a range of analyses and advice to help you answer many financial questions in your life. In our experience, you should seek out a financial advisor when you relate to one of these situations:

  • You no longer enjoy or feel confident managing your wealth yourself.

Many people successfully manage their own finances and prefer the control, privacy and minimal costs that come with a do-it-yourself approach. Often, however, you realize one day that you have accumulated meaningful wealth and you are not sure you are doing the best you could. It takes too much time to follow your investments and make decisions in changing market conditions. Also, maybe you believe you have done well, but are not sure how to address future financial challenges. You are not sure how to determine how much of your wealth you can live on without a regular paycheck. You want to pay for college, weddings or structure your legacy and you realize these goals take broader expertise. If this sounds like you, it is time to find a financial advisor.

 

  • You have outgrown your current financial advisor. 

Maybe you’ve worked with your advisor for years. You meet annually to go over your investments; you review charts and graphs and statements. He’s a nice guy, but there’s a nagging feeling that perhaps it’s no longer enough. Your life is more complex than when you started together. You may be facing college expenses, paying for weddings or considering the retirement you would like. You know your will is outdated or perhaps you never got around to getting one; you wonder if your insurance is still adequate. If your advisor hasn’t been asking about these aspects of your life and offering guidance, perhaps you have outgrown your advisor. He still is a knowledgeable financial advisor, but you have reached a level of wealth in which you need someone with a different range of expertise to help you consider the dynamics of your current life. It’s time to do some research and find the right person to help you with your next steps in your journey.

  • You have had a recent change in circumstances. 

Your best-fit advisor is someone who works with clients very similar to you. When your circumstances change, you often need to rethink your whole team. Whether you have sold a company, accepted a large pension payout or received an inheritance, you may find yourself in a very different financial situation. When this happens, it is usually best to move slowly and carefully. You will want to take some time to consider any changes to your lifestyle and what new dreams inspire you.


While you may feel very loyal to any advisors that have helped you get to this point, often, they are not the same professionals best suited to advise you for the future. It is time to slowly, but steadily, start meeting new professionals that have experience working with people like you.

How do you choose a financial advisor?

The process of selecting the right advisor is a little like dating, as a colleague once put it. Just like you want to find a partner who understands your goals, has integrity, inspires trust, and communicates clearly, you want to find a financial professional who exhibits those same qualities. So, take your time, ask the right questions and make sure you are comfortable that this person has your best interests at heart.


Before you start searching for an advisor, put some thought into what areas of guidance you would like and how you hope to work with this person. Understanding what your goals and needs are will help you narrow the search. For example, if you primarily need investment guidance and retirement planning, you may select a firm that emphasizes financial planning. If you have complex needs in which you would like your tax strategies, estate goals and investments coordinated, you will seek a firm with a broader range of expertise. Select an advisor that understands your set of circumstances and who works regularly with other clients similar to you in terms of complexity and wealth.


Before you talk to potential advisors, it is good to actually write down your questions. This helps you compare their answers consistently and objectively. Be sure to add a comment area for yourself too though, because just like dating, there is an important intangible element to a successful relationship. If you’re set to discuss your financial situation with an advisor, here are five of our suggested questions you may want to ask.

  1. What is your background and what are your credentials?
  2. What services and products do you offer?
  3. How are you compensated? 
  4. How will we work together? 
  5. What is your approach for someone like me? 

 

When it’s time for a new financial advisor, put some time and effort into the search. If you have been referred by friends or found a few potential names on the web, you can do some preliminary screening about their business model, compensation and disciplinary history by looking at their website and their Form ADV on the SEC’s website. You can also check their regulatory history on FINRA’s website. Once you have done your homework and clarified what you are looking for, get ready for some "dating." Some advisors will take you to coffee and others will have a personalized “welcome” sign in their office. Use your list of questions to find the qualified advisor that can deliver the expertise you seek and also offers the comfort and confidence that comes from building a genuine relationship with your financial advisor.

 

To Learn More, visit our website at www.summitplacefinancial.com

This award was issued on 12/01/2023 by Five Star Professional (FSP) for the time period 03/13/2023 through 09/29/2023. Fee paid for use of marketing materials. Self-completed questionnaire was used for rating. This rating is not related to the quality of the investment advice and based solely on the disclosed criteria. 6,515 New Jersey-area wealth managers were considered for the award; 462 (7% of candidates) were named 2024 Five Star Wealth Managers. The following prior year statistics use this format: YEAR: # Considered, # Winners, % of candidates, Issued Date, Research Period. 2023: 6,606, 407, 6%, 12/1/22, 3/21/22 - 10/18/22; 2022: 6380, 431, 7%, 12/1/21, 4/12/21 - 10/15/21; 6123, 459, 7%, 12/1/20, 3/30/20 - 10/23/20; 2020: 6210, 480, 8%, 12/1/19, 3/1/19 - 10/16/19; 2019: 6097, 477, 8%, 12/1/18, 3/21/18 - 10/12/18; 2018: 4383, 415, 9%, 12/1/17, 2/21/17 - 10/12/17; 2017: 3868, 664, 17%, 11/1/16, 2/25/16 - 10/7/16; 2016: 4143, 626, 15%, 11/1/15, 4/15/15 - 10/16/15; 2015: 5063, 672, 13%, 12/1/14, 4/15/14 - 10/16/14; 2014: 3315, 646, 19%, 12/1/13, 4/15/13 - 10/16/13; 2013: 4049, 733, 18%, 12/1/12, 4/15/12 - 10/16/12; 2012: 1312, 400, 30%, 11/1/11, 4/15/11 - 10/16/11.
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Please remember that past performance may not be indicative of future results.  Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by Summit Place Financial Advisors, LLC -“SPFA”), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful.  Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions.  Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from SPFA.  Please remember that if you are a SPFA client, it remains your responsibility to advise SPFA, in writing, if there are any changes in your personal/financial situation or investment objectives for the purpose of reviewing/evaluating/revising our previous recommendations and/or services, or if you would like to impose, add, or to modify any reasonable restrictions to our investment advisory services. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. SPFA is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of SPFA’s current written disclosure Brochure discussing our advisory services and fees is available for review upon request. Please Note: SPFA does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to SPFA’s web site or blog or incorporated herein, and takes no responsibility for any such content. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

*Winners appearing on this page do not pay a fee to be considered or to win the Five Star Award. Professionals with a digital profile have paid a promotional fee.
Wealth managers do not pay a fee to be considered or placed on the final list of Five Star Wealth Managers. The award is based on 10 objective criteria. Eligibility criteria - required: 1. Credentialed as a registered investment adviser (RIA) or a registered investment adviser representative; 2. Actively licensed as a RIA or as a principal of a registered investment adviser firm for a minimum of 5 years; 3. Favorable regulatory and complaint history review (As defined by FSP, the wealth manager has not; A. Been subject to a regulatory action that resulted in a license being suspended or revoked, or payment of a fine; B. Had more than a total of three settled or pending complaints filed against them and/or a total of five settled, pending, dismissed or denied complaints with any regulatory authority or FSP's consumer complaint process. Unfavorable feedback may have been discovered through a check of complaints registered with a regulatory authority or complaints registered through FSP's consumer complaint process; feedback may not be representative of any one client's experience; C. Individually contributed to a financial settlement of a customer complaint; D. Filed for personal bankruptcy within the past 11 years; E. Been terminated from a financial services firm within the past 11 years; F. Been convicted of a felony); 4. Fulfilled their firm review based on internal standards; 5. Accepting new clients. Evaluation criteria - considered: 6. One-year client retention rate; 7. Five-year client retention rate; 8. Non-institutional discretionary and/or non-discretionary client assets administered; 9. Number of client households served; 10. Education and professional designations. FSP does not evaluate quality of services provided to clients. The award is not indicative of the wealth manager's future performance. Wealth managers may or may not use discretion in their practice and therefore may not manage their clients' assets. The inclusion of a wealth manager on the Five Star Wealth Manager list should not be construed as an endorsement of the wealth manager by FSP or this publication. Working with a Five Star Wealth Manager or any wealth manager is no guarantee as to future investment success, nor is there any guarantee that the selected wealth managers will be awarded this accomplishment by FSP in the future. Visit www.fivestarprofessional.com.