posted: Apr. 10, 2008 @ 6:56p 
What are the top 10 interview questions you would ask when interviewing potential financial planners?
Questions to ask when interviewing a financial advisor Archived From: Finance |
What are the top 10 interview questions you would ask when interviewing potential financial planners?
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1.) How much are you making from what you're trying to sell me.
I don't understand why anyone would need a financial planner. I don't understand why someone would relegate all their hard-earned money to a "planner". Maybe someone with a track record of successful investment AND NOT selling products... read a few books and you'll be as competent as most of the "financial planners" out there.
I have been pretty ignorant about stocks and securities. Last year when the real estate slowdown started, I cashed out of my projects and bought as many good books as I could find on stock/securities investing... and I've done ok for myself.
Make sure they are licensed from FINRA
ArbolLoco said:I don't understand why anyone would need a financial planner. I don't understand why someone would relegate all their hard-earned money to a "planner". Maybe someone with a track record of successful investment AND NOT selling products... read a few books and you'll be as competent as most of the "financial planners" out there.
I have been pretty ignorant about stocks and securities. Last year when the real estate slowdown started, I cashed out of my projects and bought as many good books as I could find on stock/securities investing... and I've done ok for myself.
I don't understand it either. I'm trying to learn more about why so many financial planners exist and why so many people around me use them. I feel like I'm missing something but I'm not so sure I am.
I know someone that is looking in to getting a financial advisor because of a complicated tax situation. From moving, to cashing in stock options. This way they can contact their financial advisor before stock options are cahsed, or other financial moves are made, and to find out what tax implications it could have. I would say it is highly recommend for that sake, but maybe not investment strategy sake. Also, you would have to have a very high net worth to consider it, imho
sailmaster1955 said:
I don't understand it either. I'm trying to learn more about why so many financial planners exist and why so many people around me use them. I feel like I'm missing something but I'm not so sure I am.
Fatwallet is my financial advisor and it's free. Every other financial advisors I've talked to just want to make me poorer by taking a percentage of my money.
Ryan431101111 said:I know someone that is looking in to getting a financial advisor because of a complicated tax situation. From moving, to cashing in stock options. This way they can contact their financial advisor before stock options are cahsed, or other financial moves are made, and to find out what tax implications it could have. I would say it is highly recommend for that sake, but maybe not investment strategy sake. Also, you would have to have a very high net worth to consider it, imhonot a "financial advisor"... a "tax professional". two different animals.
the test:
keep a poker face --- and start talking about this aunt you know that has quite a bit of money and has really got a bad deal from a financial planner
then go back to the discussion about your insignificant assets and how you are a bit confused about stocks and mutual funds
then mention the aunt again --- tell him the aunt is really unhappy about the guy managing her assets
the answer:
if he/she says we are not here to talk about your aunt ... we are here to talk about your financial planning ... then they passed the first test
if he/she starts probing about the aunt trying to get a piece of her action --- you are talking to your typical greedy salesman --- call them on it --- and walk out
Assuming someone didn't feel up to learning enough about finance to manage their own money- and I think most FatWalleters could manage it- I would insist on a fee only adviser. If some is going to make money depending on what they tell you to buy there can't help but be a conflict of interest.
Can you show me some kind of verified (audited)track record of your investment success over the
last twenty years ?
decades said:Can you show me some kind of verified (audited)track record of your investment success over the
last twenty years ?
those details are confidential ---
I can assure of my background though --- I am CFPPA and CPWA and CFRIA and chartered CWA
Financial planner or investment manager?
Investment manager: Ask to see if they're GIPS compliant and see their track record. They'll show you their 1, 2, 3, 4, 5, 7, 10 yr result on investment that is certified
Financial planner: This is the part I don't understand....they're supposed to "plan" for you and charge a fee, not plan for free in attempt to sell you crap. They might as well do one of those cheesy ads that say "FREE FINANCIAL PLANS" to get you in the door then to load a bunch of crappy products on ya.
I agree with the financial planner vs investment manager question completely. We saw a financial planner about 6 months ago, mostly for my own financial planning affirmation. As we told the planner, "we think we're doing 90% of it right, we just want to be sure".
I checked references on several NAPFA certified planners then called 3 different planners. All were happy to chat with me on the phone for 5-10 minutes and answered all of my selecting a financial planner questions. All 3 asked for a quick summary on where we were financially and what we hoped to achieve from meeting with them.
My questions - first for you, what are you trying to achieve in meeting with a financial planner? Do you want someone to tell you what funds to put your 401k investments into? Do you want someone to tell you financial plan to and affirm what you're doing? Do you want to hand over the money and let them make it grow?
Questions for a potential planner:
- How do you get paid? Is it fee based ($ per hour) or commission? What are your rates?
- Are you a NAPFA member?
- How long have you been an financial planner?
- Do you specialize in a particular type of financial planning or what is your typical client?
- Do you manage investments for people? How much money are you currently managing?
- If they steer you toward any particular funds/products ask them if they receive any compensation for recommending that fund.
- Most financial planners will also be able to take a look at your overall insurance state, ask if they can provide this.
- Most will also be able to talk about your basic legal needs (wills, trusts, health care directives, etc). Can they recommend what of this you need and how you can get it.
What was your last job ?
Red or black?
puckah18 said:Financial planner or investment manager?
Investment manager: Ask to see if they're GIPS compliant and see their track record. They'll show you their 1, 2, 3, 4, 5, 7, 10 yr result on investment that is certified
Financial planner: This is the part I don't understand....they're supposed to "plan" for you and charge a fee, not plan for free in attempt to sell you crap. They might as well do one of those cheesy ads that say "FREE FINANCIAL PLANS" to get you in the door then to load a bunch of crappy products on ya.
Ok, I guess I just learned something. I didn't know the difference between "Investment Manager" and "Financial Planner". I did ask about past performance results and was told there "is no such thing in existence". This might be true as he is a financial planner - right? How would I find a local "Investment Manager"?
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