What is the best way to find a financial advisor?

So you can find a financial advisor by following some steps carefully written by The Balance:

1. Understand the types of financial advisors: Some financial advisors offer financial planning services, but not Investment management services. Others manage investments but rarely provide financial planning. In order to find the best financial advisor for your situation, you need to know the type of financial advice you need and what services a potential advisor provides.

2.?Seek a financial advisor with reputable credentials: All credentials are not created equal. Some organizations create easily accessible expense credentials so salespeople can acquire the credentials and become experts. To find an advisor or financial planner in good standing, look for someone with the CFP (Certified Financial Planner) or PFS (Personal Finance Professional) designation, or an investment advisor with the CFA (Chartered Financial Analyst) credential.

3. How are financial advisors compensated for their specialized skills: There are many ways financial advisors charge for their services, but the most objective and impartial financial advisors charge a fee. To hire the best financial advisor, you need to understand all the ways a potential financial advisor may be compensated, such as charging an asset-based fee, an hourly fee, or participating commissions.

4. Use a search engine to filter your criteria: Searching online is a great way to narrow down consultants in your zip code who have the right credentials and appropriate billing structure to meet your needs. You can use the financial advisor search engine to enter specific criteria about the type of advisor you are looking for.

5.?Ask these questions before hiring: The right questions can help you weed out financial advisors who don’t communicate well with you. How long have they been practicing? How are they compensated? Can they guide you through different retirement plans?

Using specific interview questions can help you determine the financial advisor's communication style, as well as their areas of expertise and ideal clients. The key is to make sure you understand the answer and feel comfortable enough to ask follow-up questions if you don't.

6. Verify Credentials, Check Complaints: Before hiring someone, to make sure that someone is legitimate and has a good service record, contact the Financial Industry Regulatory Authority (FINRA), Security and Exchange Commission Verify the advisor's credentials and complaint history by checking their records with the SEC, CFP Board, or other member organization associated with the advisor.

7. Learn how to detect fraud risks: When someone has custody of your assets, it is easier to commit fraud. Most reputable financial advisors use what's called a third-party custodian to hold your assets. Be aware of advisors or companies that have custody of your funds, or have another related company acting as a custodian.