10 questions to ask your potential Financial Adviser

10 questions to ask your potential Financial Adviser
Photo by Hadija / Unsplash

For many investors, working with a financial advisor is an important part of planning for the future and making wise investment decisions. Finding the right financial advisor can make all the difference in the world when it comes to planning for the future, but getting started can be daunting. What sorts of questions should one ask their financial adviser? And, what sorts of criteria might one use to gauge whether a financial advisor is right for them? We’ll cover some common distinctions between different financial advisers and why they might matter to you. Here are ten questions to ask your financial advisor:

What is the size of the firm?

One of the first things you might want to ask yourself and a potential investment advisor is how large their firm is. In truth, there’s no one right size for all investors, so it’s important to consider what you value in financial advising and planning. A smaller firm might be able to offer you a personal touch, as well as more focus on your finances–while a larger firm might offer vast resources and a large team backing them up. Each will offer its own advantages, and depending on your investing and planning style, you may prefer one over the other. Consider what you value in an investment advisor and how the size of their firm might affect that. Advisors at larger firms may have a higher client load, while advisors at smaller firms may have fewer resources available to them. Whatever sized firm you consider working with, consider asking a few questions:

  • What does their caseload look like? Will they have time to dedicate to focusing on your portfolio and finances?
  • If your financial advisor becomes unavailable, is there someone else available to help you out?
  • If you require services that they don’t offer, what might a referral look like?

What is their area of expertise?

Another important question to ask your financial advisor is what their area of expertise is. What sorts of financial strategies do they focus on? If you need help, specifically, with retirement planning, for example, you might look for a financial planner who specialises in preparing for retirement. If you’re focused on investing, you may be looking for a financial advisor who focuses on investments. Whatever your needs are in a financial advisor, see how they line up with their areas of expertise.

What level of qualifications do they hold?

This part can be especially important–what level of qualifications does a potential financial advisor hold, are they minimum or advanced, and how might those impact the level of service they can offer you. There are some important qualifications you can look for:

  • FCA Authorisation: Any financial advisor that you consider meeting with, at minimum, should have an FCA authorisation. This allows them to legally offer regulated financial services in the U.K., and no financial advisor should be without this authorisation.
  • CII qualifications: The Chartered Insurance Institute can issue certificates and diplomas in financial services, ranging 6 levels. CII qualifications can tell you a lot more about how well-versed you might expect a financial advisor to be, and what services they can offer.
  • IFA certification: In order to be an Independent Financial Advisor, or IFA, they must hold either a level 4 Diploma in Regulated Finance Planning from CII, or an equivalent qualification from the Chartered Institute for Securities and Investments or London Institute of Banking and Finance. Independent financial advisers can offer a wider range of services than restricted financial advisers can.

How many years of experience do they have?

While qualifications, education, and services offered are all important, so is experience. Consider asking any financial advisor you meet how long they’ve been in business. While it’s important that they have the expertise, you may be interested in the amount of experience they have and what that tells you about how they manage finances.

How do they deliver advice?

Another important question to ask any potential advisors is fairly simple but nonetheless crucial: How do they deliver advice? Do you prefer the personal touch of face-to-face or F2F meetings? Do you find speaking over the telephone more convenient? Perhaps communicating online is more your speed. Whatever the case, be sure that you discuss with your advisor how they can deliver advice, and consider if their method of delivering advice works well for you.

Where are they located?

If you prefer a personal touch as well as face-to-face meetings, this question might be particularly important to ask. What is their location? You may not want to travel to a nearby city every time you need to speak face-to-face with an adviser, so be sure to determine where they’re located and where you’ll be able to reach them.

What’s the minimum pot size required to take on a client?

Some advisors may not take on clients whose pension pots are under a certain size. Based on how they bill, it may not be worth it on their end. Be sure to ask a potential advisor what their minimum pot size is, and determine if they’re a good fit for you.

Finding the right financial advisor with less hassle

There are a lot of things to consider when looking for a financial advisor–and ten very important questions to ask:

  1. What’s the size of their firm?
  2. What does their caseload look like?
  3. What happens if my normal financial advisor isn’t available?
  4. If you require services the firm doesn’t offer, what does a referral look like?
  5. What is their area of expertise?
  6. What qualifications do they have?
  7. How many years of experience do they have?
  8. How do they deliver advice? (telephone, internet, or face-to-face.)
  9. Where are they located?
  10. Do they require a minimum pot size, and if so, what is it?

If you want to save yourself some time, you can also easily search for a financial investor to meet your own unique needs using our powerful search tool to browse our directory of FCA approved financial advisors. Simply select what you need help with, your desired firm size, and your desired distance to find financial advisors that meet your criteria. Find out how we can even match you with an advisor by simply entering your postcode here.