• Matt Morizio

How to Find a Financial Advisor


I created this site to answer this exact question: How do you find a financial advisor you can trust who is really good at what they do?

First, come up with a list of potential advisors.

1a) You can run a quick Google search for “2017 best fee only financial advisor in the country,” or something like that. You’ll have to cut through the noise among the results, but it’s certainly an option. More and more advisors are going virtual, and if you’re someone who doesn’t need to sit across the table from your advisor to have a conversation, virtual video chats are a perfectly viable option.

If you want a local advisor, I recommend searching NAPFA’s (National Association of Personal Financial Advisors) page for an advisor near you. The advisors who join NAPFA are all fee-only advisors. I wrote in detail what a fee only advisor is here, but in summary, there are no inherent conflicts of interest when working with this type of advisor because they cannot accept commissions. If internet searching doesn’t sound like the route you want to take, start talking to people in your network.

1b) Don’t underestimate the power of your network, both personal and professional, and don’t be shy to ask for recommendations.

Think about all the people you know. Who among them do you respect? Who seems to have a firm grasp on their finances? Who is in your life stage? Who is in a life stage you hope to be in one day? Ask them who their financial advisor is. Talk to CPA’s and Trust and Estate attorneys. They often have a few trusted financial advisors in their network. Make a list of all the names you’ve been given.

Next, research them.

2) When I was buying my wife her engagement ring, I quickly became a diamond expert. Cut, Color, Clarity, and Carat, I still remember the four C’s of diamond buying. I wanted to make sure I wasn’t getting screwed by any diamond salesmen.

If we become experts on materiel goods, why, then, do we not research the person who will handle our life savings?

First, go to the advisor’s firm's website and/or BrokerCheck, a FINRA (Financial Industry Regulatory Authority) sponsored site. On the company’s website, scroll to the fine print at the bottom. If you see the words “member FINRA, SIPC,” or if BrokerCheck lists them as both an IA (Investment Adviser) and B (Broker) or just a Broker, move on. They aren’t a fee-only advisor (which I cover in detail here) and there are inherent conflicts with these types of advisors, even if they are the most honest, sincere people on the planet.

Assuming they pass the fee-only test, look at their social pages - LinkedIn, Facebook, Instagram, Twitter, etc. Get to know what types of lives they live. You can’t judge a book by its cover, true, but if the advisor tweets 20 times a day about how much they hate Trump, and your most prized possession is your “Make America Great Again” hat, you may not want to waste each other’s time having that introductory meeting. Remember, if the relationship between you and your financial advisor works as it should, this person will be in your life for decades and will become one of your closest confidants.

You’ve narrowed your search to a final few, now meet them.

3) It’s lot like being a hiring manager and interviewing for your vacant position. Meet with at least a couple in person/via video conference. It sounds cheesy, but you need to feel a connection with them. They will be part of your life for a long time. You want to enjoy their company. They don’t need to give you the warm and fuzzies, but you need to walk out of that meeting saying to yourself, “They know what they are doing. I understand their approach and investment philosophy, and it works. My money will be well cared for, better than I could care for it on my own.”

One note on investment philosophy, and this is my personal opinion, but look for people whose philosophy is different than the consensus. As Ray Dalio, one of the most successful hedge fund managers ever, puts it, it should be “different than the consensus because the consensus is baked into the price.” In other words, if the advisor sounds like every other advisor, you can probably expect the same results as everybody else.

At the end of this process, go with your gut.

4) An advantage to working with a fee-only advisor is that there are no separation fees. You can leave them anytime you want for any reason you want. You’ve done your homework to select this person. Choose the one you feel best matches up with your personality, morals, and expectations from a financial advisor.

Hope this helps, and if you like what you read, subscribe below to see my latest articles explaining investing in plain English.

#FinancialAdvisor #Finance #Howto

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Investment advice offered through Beck Bode, LLC, a fee-only Registered Investment Advisor in the Greater Boston area.