19 Questions to ask your financial advisor via WSJ

19 Questions to ask your financial advisor via WSJ


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19 Questions to ask your financial advisor via WSJ
Old 08-30-2017, 02:44 PM
paperclip202 paperclip202 is offline
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Join Date: Jan 2013
Location: Village of Poinciana
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Default 19 Questions to ask your financial advisor via WSJ

Great article from the WSJ. I suggest that investors print these out and review with your advisor. In the end, you will find that many/ most advisors are just sales reps trying to sell you products. Good luck to all.

-------------------------- key points of the article- subscription required - The 19 Questions to Ask Your Financial Adviser - MoneyBeat - WSJ

Getting all stockbrokers, financial planners and insurance agents to act in the best interests of their clients is a struggle that financial firms and their regulators still haven’t resolved. That should be their job — but for now, it’s yours.

The obligation of those who give investment advice to serve clients, not themselves, is called fiduciary duty. That obligation is far from universal and, in some ways, is in retreat.

Some brokerage firms warn that they may put their interests ahead of yours regardless of whether your adviser happens to be a CFP.

Until regulators and trade groups sort this out — and the next total solar eclipse may come first — the burden of finding someone who will act in your best interest is on you.

That means asking an adviser the right questions (and listening for the best answers). I encourage you to clip or print out this column and bring it to your next meeting with your financial adviser.

1. Are you always a fiduciary (for taxable and qualified accounts), and will you state that in writing? Please sign this -- http://www.thefiduciarystandard.org/...2-2-23-15-.pdf

2. Does anybody else ever pay you to advise me and, if so, do you earn more to recommend certain products or services?

3. Do you participate in any sales contests or award programs creating incentives to favor particular vendors?

4. Will you itemize all my fees and expenses in writing? (each year)

5. Are your fees negotiable?

6. Will you consider charging by the hour or retainer instead of an annual fee based on my assets?

7. Can you tell me about your conflicts of interest, orally and in writing?

8. Do you earn fees as adviser to a private fund or other investments that you may recommend to clients?

9. Do you pay referral fees to generate new clients?

10. Do you focus solely on investment management, or do you also advise on taxes, estates and retirement, budgeting and debt management, and insurance?

11. Do you earn fees for referring clients to specialists like estate attorneys or insurance agents? (big red flag in TV)

12. What is your investment philosophy?

13. Do you believe in technical analysis or market timing?

14. Do you believe you can beat the market? (the odds are very low if you properly benchmark the asset classes)

15. How often do you trade? (As seldom as possible)

16. How do you report investment performance? (This should be after all expenses, advisor fees, compared to an average of highly similar assets (benchmark) that includes dividends or interest income, over the short and long term.)

17. Which professional credentials do you have, and what are their requirements? (Among the best are CFA [Chartered Financial Analyst], CPA [Certified Public Accountant] and CFP, which all require rigorous study, continuing education and adherence to high ethical standards. Many other financial certifications are marketing tools masquerading as fancy diplomas on an adviser’s wall.)

18. After inflation, taxes and fees, what is a reasonable estimated return on my portfolio over the long term?

19. Who manages your money? (and how is it managed?)

Are there other questions you would add to the list? Please send them my way at intelligent.investor@wsj.com and I’ll write another column with your best recommendations.

Old 08-30-2017, 02:58 PM
rubicon rubicon is offline
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Join Date: Nov 2010
Posts: 13,708

I am moving one of my accounts because the financial guy refuse to drop his fees
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fees, financial, clients, investment, adviser

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