By Wesley Howard Triani

Talking to a financial advisor can be one of the most important steps you take in securing your financial future. Whether you’re planning for retirement, managing investments, or navigating complex financial decisions, a good financial advisor can provide valuable guidance tailored to your unique needs. However, to get the most out of the relationship, it’s crucial to ask the right questions and ensure you understand the advice you’re receiving.

Over my 43 years in the financial services industry, I’ve seen how clear communication and a proactive approach can empower individuals to make confident financial decisions. If you’re preparing to meet with your financial advisor—or considering working with one for the first time—here are the key questions to ask to ensure your financial strategy is on the right track.

What Are Your Qualifications and Experience?

The first step in building trust with your financial advisor is understanding their qualifications and experience. Financial advisors come from a variety of backgrounds, so it’s essential to confirm that they have the expertise to handle your specific needs.

Ask about their certifications and designations, and inquire about their years of experience in the field. You might also ask:

• Have you worked with clients in situations similar to mine?
• Do you specialize in retirement planning, investments, or another specific area?
• What is your educational background?

The answers to these questions will help you determine whether the advisor is well-suited to guide you.

How Are You Compensated?

Understanding how your financial advisor is compensated is critical to ensuring their advice aligns with your best interests. Advisors can be paid in several ways:

• Fee-only: They charge a flat fee, hourly rate, or a percentage of your assets under management.
• Commission-based: They earn money by selling financial products like insurance or investments.
• Fee-based: A combination of fees and commissions.

Each compensation structure has its pros and cons, but transparency is key. Ask:

• Are you a fiduciary? (Fiduciaries are legally required to act in your best interest.)
• Will you disclose any conflicts of interest?
• How much will I pay in total, including fees and commissions?

These questions will help you evaluate whether the advisor’s incentives are aligned with your financial goals.

What Is Your Investment Philosophy?

Every financial advisor has a unique approach to investing, and it’s important to ensure their philosophy matches your goals and risk tolerance. Some advisors may take a more conservative approach, while others may focus on aggressive growth strategies.

Ask your advisor:

• How do you determine an appropriate asset allocation for my portfolio?
• What is your strategy for managing market volatility?
• Do you incorporate diversification to reduce risk?

If your advisor suggests specific strategies, such as Dollar Cost Averaging, make sure they explain how these methods work and recommend consulting with your accountant or financial advisor to see if they’re appropriate for you.

How Will You Help Me Plan for Retirement?

Retirement planning is one of the most common reasons people seek financial advice, and for good reason—your retirement strategy can impact your quality of life for decades. Ask your advisor:

• How much do I need to save for retirement?
• What strategies do you recommend to maximize my retirement income?
• How will Social Security benefits factor into my plan?

Your advisor should provide a clear roadmap that aligns with your retirement goals. If they recommend maximizing your 401(k) or IRA contributions, ensure they advise you to discuss these changes with your accountant or CPA to confirm they fit within your broader financial plan.

What Happens If My Goals or Circumstances Change?

Life is unpredictable, and your financial strategy may need to adapt to changes such as a new job, marriage, or unexpected expenses. A good financial advisor should be flexible and proactive in helping you adjust your plan.

Ask:

• How often will we review my financial plan?
• Will you notify me of any necessary changes or adjustments?
• How do you handle major market fluctuations?

Regular check-ins and ongoing communication ensure that your financial plan evolves alongside your life.

Can You Explain This in Plain Terms?

One of the most important traits of a great financial advisor is their ability to communicate complex concepts in simple, understandable terms. If you don’t understand the recommendations being made, don’t hesitate to ask for clarification.

Questions like:

• Can you break this down for me?
• What are the potential risks and rewards of this strategy?
• Are there alternatives I should consider?

These questions ensure that you’re fully informed and comfortable with the decisions you’re making.

How Will You Measure Success?

Success in financial planning looks different for everyone. For some, it’s about building a retirement nest egg; for others, it’s achieving specific milestones like buying a home or paying for a child’s education.

Ask your advisor:

• How will we track my progress toward my goals?
• What benchmarks will we use to measure success?
• How will we adjust the plan if we’re not on track?

Clear metrics and regular updates will keep you informed and confident in your progress.

Do You Collaborate With Other Professionals?

Financial planning often overlaps with other areas, such as tax planning and estate planning. A collaborative advisor should provide a comprehensive financial strategy and recommend working with trusted insurance agents, tax professionals, and legal advisors to ensure all aspects of your financial life are covered. 

Ask:

• Do you work with my CPA or accountant on tax-related matters?
• Can you coordinate with my attorney to address wills, trusts, or directives?
• Will you recommend specialists if needed?

This teamwork ensures that all aspects of your financial life are aligned.

Final Thoughts

Talking to a financial advisor doesn’t have to be intimidating. By asking the right questions, you can build a strong relationship with your advisor and make informed decisions about your financial future. Remember, you’re the driver of your financial journey—your advisor is there to guide and support you.

Whether you’re planning for retirement, managing investments, or navigating complex financial questions, clear communication and mutual trust are the foundation of a successful partnership. Take the time to prepare for your meetings, ask thoughtful questions, and don’t hesitate to seek clarification when needed. With the right guidance, you’ll be well on your way to achieving your financial goals with confidence and peace of mind.