Financial Advisor

How To Avoid Common Mistakes When Hiring a Financial Advisor

By Kendal Cann, Certified Financial Advisor in Florida

Searching for the right financial advisor can feel overwhelming, but it’s a crucial process. Your choice can affect your financial health for years to come. Here’s what you need to know to make a well-informed decision, so you can avoid the pitfalls I commonly see.

Common Mistakes People Make When Hiring a Financial Advisor

1. Not Interviewing Multiple Financial Advisors

The biggest mistake I see is people hiring the first financial advisor they meet. It’s understandable given the complexity of financial planning, but this approach often leads to dissatisfaction. It’s essential to interview at least two to three advisors to find the right match for your needs.

2. Misunderstanding Fees

While it’s common for people to inquire about fees, many fail to understand the intricacies behind them. Financial advisors have varied service offerings. Therefore, a simplistic query like “What are your fees?” is akin to asking a restaurant, “What’s the cost of food?”

Ask specific questions such as:

 

    • How often will we meet?

    • Are annual financial plans included?

    • Do you use mutual funds with expense ratios?

This will give you a clearer idea of what you’re actually paying for.

3. Not Verifying an Advisor’s Fiduciary Status

People often ask if an advisor is a fiduciary but fail to verify it. You can check an advisor’s fiduciary status by going to the SEC website and typing in their name or firm.

Things You Need to Know Before Hiring

1. Understand Financial Vernacular

Make sure you’re familiar with industry terms like fiduciary, expense ratio, mutual fund, ETF, stock, and bond. This will help you to not get taken advantage of in any conversation.

2. Know Your Preferred Working Style

Know what type of personality you work best with. If you’re a business owner, you’re likely already attuned to this. If not, it’s a skill worth developing. Your financial advisor will be a significant part of your life; make sure you’re comfortable with them.

3. Types of Financial Advisor Services

Understand the kinds of services available:

 

    • Full Service Investment Management: The most comprehensive and often the costliest. Fees are typically around 1% for a million-dollar portfolio.

    • Retainer Consulting Fee: Usually for a financial plan. Good for those just starting out.

    • Coaching: Aimed at those who can’t meet minimums or need basic financial literacy. It’s a newer and less costly service.

Who Do I Work With and Why

I typically work with like-minded individuals who are focused on growth, both personally and professionally. If you’re someone who values the idea of a partnership, we’d likely get along well.

Conclusion

Remember, the process of hiring a financial advisor in Florida should be deliberate and well-considered. Always vet multiple advisors, understand their fee structure, and verify their fiduciary status. Don’t rush the process. Your financial future is too important to risk on a poor decision.

If you found this article helpful and you’re looking for a financial advisor in Florida, feel free to contact me. Have a blessed day!

 


Keywords: Financial Advisor in Florida, Hiring a Financial Advisor, Financial Planning, Fiduciary, Fees, Investment Management, Retainer Consulting Fee, Coaching, Kendal Cann.

Meta Description: Are you looking for a financial advisor in Florida? Read these expert tips from Kendal Cann to avoid common mistakes and make an informed decision.