Whether you’re doing it for the first time or the tenth, identifying a financial advisor who is a good fit for you and your financial situation can be a daunting task.  Before you start Googling “Financial Advisors,” here are five things you should consider that may make the search that much easier:

  1. What is it you’re really looking for? Before you can decide on the right advisor, you have to decide what advice you’re really looking for.  Are you getting ready to transition to retirement? Are you just getting started and looking for someone to help build you a comprehensive plan for your financial future?  Or are you just looking for a broker to execute the trades you already know you want to make? There are firms that excel in these and other areas, but you want to make sure you’re matching the firm to the goal, not the other way around.
  1. Make sure your new advisor has the right credentials. You’ll find a slew of alphabet soup that many financial advisors put behind their name as “certifications.”  Certifications certainly don’t mean everything, but not all certifications are cut from the same cloth, either.  You can view a list of over 130 financial advisor certifications here.  You’ll note that some have much higher standards than others.  For instance, when you sort this list by those that require a background check, fiduciary standard and college education, only six remain.  It’s one thing to pay for a certification, it’s another to commit to the highest standards of education and ethics in the industry.
  1. Review their regulatory history. Many don’t know this, but the complete regulatory history of all brokers registered with FINRA – and all investment advisor representatives registered with the SEC – is easily available on the internet.  This includes a complete license and employment history and a breakdown of any formal complaints or arbitrations filed against them. Check out FINRA BrokerCheck here and the SEC’s Investment Adviser Public Disclosure website here.
  1. Does their view of the world match yours? You don’t have to know everything about the world of finance.  That’s why you hire a financial advisor. But everyone has a preconceived set of core values and world views that impact the way they invest.  Too often investors ignore those core values because “the advisor must know this better than me.” That’s the recipe for a disaster. Spend time interviewing advisors and find out if their core values match your own.  In the end both you and your advisor will be glad you did.
  1. Talk to your friends and family. Each of us have people we look up to when it comes to their ability to invest and plan for their future.  The ones who seem to already have it “figured out.” Chances are they didn’t get there alone. Who could be better to ask for a recommendation when it comes to seeking out an advisor?  More often than not, you’ll begin to find some common threads of experience across your circle of influence. The most helpful recommendations are ones that come from those whom you trust.  Go ask for them!