Michael Callahan
If financial planning isn’t your area of expertise, meeting with your financial advisor can seem a little daunting. It shouldn’t – a reputable and professional advisor will make you feel comfortable and explain your options in terms that make sense to you. A meeting with your financial advisor is an opportunity to take control of your future and prepare for what’s coming next. To get the most value out of a meeting, ask the questions that will help you feel confident about every element of your financial plans.
Are You the Right Financial Advisor For Me?
If you’re starting a new relationship with a financial advisor, there are a lot of questions you can ask before committing to move forward. That’s important because choosing a financial advisor isn’t just about finding someone who knows how to do the job, but whose experience, services and philosophies are in line with your needs. It’s also important to understand what to expect from the relationship.
So feel free to ask lots of questions – a reputable financial advisor should be able to answer them all honestly.
- How will the advisor be paid, and what fees can you expect?
- How often will the advisor want to meet with you?
- How will they communicate with you about your investments?
- What qualifications does the financial advisor have?
- Will anyone else be involved in your account and be able to help you if your advisor is out of the office?
- Is the advisor a fiduciary? If so, they’re legally required to act in your best interest when making investments.
- How would your other clients describe your investment philosophy?
Even if you have an existing relationship with an advisor, you can ask some of these questions at your annual meeting. If someone new will be working on your account, or your advisor has significantly changed his investment philosophy since you first started working together, those are things you may want to know.
Are My Financial Goals and Timelines Reasonable?
Your financial goals are entirely personal. Maybe you dream of retiring early and disappearing on a houseboat, or maybe you want to run your business until your dying day. It’s your advisor’s job to help you determine whether your goals are feasible, and when you can reasonably expect to meet them.
So ask questions about your timeline. If you and your spouse are both in your 50s and hope to retire at 60, will you have enough saved by then? If you’ve always planned to pay for your child’s college tuition, and that kid is now a high schooler who has set her sights on living in Manhattan and going to Columbia, will you still be able to afford it? If you’ve always dreamed of taking a year off of work to travel the country in an RV, can you take that break without tanking your retirement plans?
Also – is there any breathing room built into your timeline? What would happen if you were injured and couldn’t work for a few months, or if a downturn in the market ate into your savings? Whatever your specific financial goals may be, your advisor should be able to help you plot the course that lets you meet them – or be willing to tell you that your plans need rethinking.
How Would You Suggest I Adjust My Portfolio?
When was the last time you and your financial advisor made a significant change to your investment strategy? During your next meeting, consider asking your advisor for their input on the current balance of your portfolio. Should you start shifting away from high-risk investments, or reallocate your assets? If you’re already well positioned, your advisor may suggest you stay the course.
What Should I Be Watching Out For Next?
Financial advisors can’t see the future, but they may be able to spot potential challenges that are coming up for their clients. From changes in tax legislation to shifts in the markets, your advisor could have some insights into the financial hurdles you may encounter over the next few years. Should you be thinking about amending your tax strategy? Should you change your spending habits now in anticipation of tighter cash flow next year? Your advisor knows your specific financial reality, so there’s no better person to help you prepare for what could be coming next.
What Are My Plans Missing?
It’s a good idea to regularly ask your advisor this question. As your circumstances change, your financial plans should evolve. When you change jobs, welcome a new family member, lose a family member or experience some other shift in circumstances, your existing plans may no longer be adequate.
You may also want to talk to your financial advisor about whether all your financial plans rely on everything going according to plan. If you or your spouse loses a job, or if you become seriously ill, or life throws some other unexpected wrench into the works, will you be able to financially recover in time for retirement? If not, what more can you do to prepare for those what-ifs?
Sachetta LLC's holistic approach to financial planning means we’ll help you craft strategies that support your goals at every stage of life. We want you to feel fully informed and empowered about your plans for your financial future. What questions do you have for your financial advisor? To get the answers you need, contact Sachetta today.