The theme for this week is: how to pick a financial advisor.

Today, I’m giving you 5 essential questions you should ask your advisor. These can be questions to a potential advisor, or questions to ask your existing advisor. After all, like any relationship, you’ll want to make sure that it continues to be a good fit and not let yourself suffer due to complacency.

So here are 5 questions you should ask your advisor:

1. What does your typical client look like? Many advisors only serve high-net worth clients, or have special expertise in working with a particular subset of clients - here at True North, we specialize in working with business owners looking to exit their business in the next 5-10 years. Be sure that your advisor specializes in and has other clients like you.
2. How long have you been an advisor? Experience counts for a lot. I’ve been doing this for almost 12 years and I’m always learning something new. Don’t pick an advisor who graduated college last week. On the flip side, consider the age of your advisor. If they’re 70 years old, how much longer will they be around to manage your portfolio. If they are closer to retirement, that’s ok. Just make sure they still have some fire left in the belly and a succession plan in place.
3. Who will be my day-to-day contact? Ideally, the financial advisor you worked with initially is also your ongoing advisor. But that’s not always the case. Ask to meet all the members of the team and how each of them will be involved with you after you become a client.
4. What’s your investment philosophy? Make sure this is clearly articulated, makes sense to you, and is consistent with your goals.
5. What are your fees? And just as important, what is the all-in cost of you managing my money? There are fees you pay your advisor, underlying fees for the investments you own, and often transaction fees as well. Be sure your advisor clearly explains the all-in cost, not just their fee, and make sure that fee seems fair and reasonable based on what they will be doing for you on an ongoing basis.

Here’s the thing...I don’t care whether or not you work with me or another advisor. Just make sure the person helping you make the most important financial decisions in life is competent and capable of answering these 5 questions.

That’s it for today. Thanks for listening.

My name is Ashley Micciche and this is the One Minute Retirement Tip.

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