How Can I Find a Financial Advisor?

… and other frequently asked questions.

Women trust the opinions of other women. You know there’s no better place to begin your search for a financial advisor or planner than to find out what other women think. At WIFE.org, we have a free program to enable you do just that. The new Women’s Choice Award for Financial Advisors is the only advisor-recognition program that acknowledges  well-qualified advisors who are committed to the women’s market and effectively serve women clients.

The popular Women’s Choice Award program, originated by WomenCertified®, Inc, is in use in businesses such as Maytag, Whirlpool, Trane, Kaiser Permanente, Scripps, automotive dealerships, and more than 50 healthcare systems around the country. Now WIFE.org has teamed with Women Certified to bring this program to the financial industry. Connecting women investors with financial advisors, this free program benefits both.

Q: Do I need a financial advisor?

Most people will benefit from the information, expertise, experience, and discipline provided by a financial advisor. If you have a fair amount of money to manage, a good advisor can help you invest your assets. But many advisors do much more than help you invest. They can help you plan for retirement, pay for college, and deal with taxes, estate planning, insurance and risk management. In addition, they can advise you on every aspect of your financial life and help you find and interact with specialists in specific areas, such as tax accountants or insurance brokers.

Q: How can I find a financial advisor I can trust?

Believe it or not, anyone can call himself a financial advisor, whether qualified or not. There are about 175,000 people holding themselves out as financial advisors, according to the Bureau of Labor Statistics, and the range of their abilities varies widely. It is so important to find someone well qualified to give you the advice you need, and to whom you can relate.

That’s why we’ve put together a listing of Women’s Choice Award® Financial Advisors, who have been evaluated using 17 objective criteria, including a survey of their female clients as part of the compliance and consumer complaint evaluation process. It’s a great place to start your search for the right advisor for you.

Q: How are Women’s Choice Award Financial Advisors selected?

The Women’s Choice Award Program, originated by WomenCertified®, Inc. in cooperation with WIFE.org, is the only recognition program based on the voice of the female financial consumer to identify advisors who women highly recommend.

The program conducts rigorous research to find professionals who provide quality services to their women clients, and who pass additional comprehensive criteria, including several years as a financial advisor, appropriate credentials and licensing, compliance with  regulatory requirements of the SEC and other regulatory bodies, and who are in good standing with the firm with which they are affiliated.

Q: How can I find an advisor with whom I can relate and who understands me?

One of the biggest issues that women have with financial advisors is feeling that they don’t have a true relationship with the advisor. Whatever the gender of the advisor  you choose, you should feel at ease with your advisor’s approach and listening skills, be sure the advisor understands your needs and concerns, and is available to answer any questions that may come up. Advisors who are most effectively serve the women’s market are able to communicate effectively and exhibit empathy, in addition to their core competency skills

WIFE.org and the Women’s Choice Award Program gives you a trusted resource to begin your search. Review the listings at Women’s Choice Award® Financial Advisors to match the skills of an advisor in your area with your needs.

Q: What credentials should a financial advisor have?

There are well over 100 financial designations.  Many simply denote that the advisor did limited study and training in a particular field, such as retirement and seniors. The most significant credentials are the CFP® designation (Certified Financial Planner), the PFS designation (Personal Financial Specialist) and the CFA designation (Chartered Financial Analyst). Those advisors have taken specialized study and passed comprehensive exams.  But don’t get mesmerized by the alphabet soup: there are many accomplished advisors with no specialized designations, but who nonetheless have a wealth of knowledge and competency developed over many years.

Q: How can I determine if an advisor is well qualified?

It’s important to hire someone competent, who has the expertise and resources to help you plan your financial future.  If you are doing your own investigation, ask for both parts of a potential advisor’s “Form ADV.” Part I tells you if they’ve had problems with regulators or clients. Part II outlines services they provide, fees and investment strategies. You can access the Form ADV online at the Investment Advisor Public Disclosure website .

Check out the Financial Industry Regulatory Authority’s BrokerCheck site  if your adviser is a broker. Make sure all the advisors certifications are current. (For example, you can go to www.cfp.net to check the status of a Certified Financial Planning practitioner). At Women’s Choice Award® Financial Advisors,we have done all of this and much more.

Q: How do financial advisors charge?

Advisors generally charge in one of three ways:

  • Fee-only advisors are paid by you for the advice they give, and don’t receive commissions from selling financial products such as stocks, mutual funds, annuities or life insurance.
  • Fee-based advisors earn fees from advice they give, and they may also earn commissions on some of the products they sell.
  • Commission-based advisors are paid commissions and fees from the products they sell.

Q: How much should I expect to pay a financial advisor?

What you pay depends on the compensation structure of the advisor, what types of services you need and how much money they manage for you. Don’t be shy about asking how your advisor is compensated and how much you’ll pay.

If you work with a commission-based advisor, their compensation will depend on the investments you buy and the amount you invest. Most fee-only advisors charge a percentage of the money they’re managing for you, usually about 1% to 2%, depending on the size of the portfolio.

Some advisors charge an hourly rate, generally between $150 to $500, or may charge a flat fee or an annual retainer based on the services you need.

Q: Should I use a financial planning group with several different professionals on staff?

There are both benefits and drawbacks to using a planning group with different types of advisors working together, such as a financial advisor, an insurance advisor, an estate-planning attorney and an accountant.

On the plus side, you will receive a wide range of financial services all in one place, from professionals who work well together and share information about you.The drawback is that there may not be clear checks and balances, and you might not receive the independent advice that you would get with unrelated advisors.

No matter what model you choose, it is important that your key advisors communicate with each other and work together in your best interest.

Q: What questions should I ask financial advisors when I interview them?

You can’t ask too many questions. In addition to obtaining public information about the advisor and researching their regulatory history, here are questions you can ask:

  • How long have you been a financial advisor, and in what capacities?
  • What are your strengths and expertise?
  • How many of your clients have been in my situation (divorce, starting a business, dealing with inheritances, estate-planning)?
  • Are you involved in any pending or settled litigation or arbitration cases?
  • Do you offer asset management only, or are you able to assist with budgeting and income and expense planning and management?
  • Can you give me references to any of your other clients who have been in my similar situation?
  • If I hire you, what will our relationship entail? How frequently will I be contacted? How often will we meet and who will be my contact person in your firm?
  • How, if at all, are your assumptions, strategies and approach changed when planning for a woman rather than a man?
  • Do you have many female clients? Are they divorced, widowed, single or part of a couple? Are they professionals, business owners, or retired?
  • What types of financial issues would you refer to other professionals?
  • Do you offer educational opportunities for your clients, such as seminars and workshops? Do you send out newsletters or regular email bulletins?
  • How many clients do you work with? Am I typical, in terms of net worth and financial issues?
  • What concrete examples can you provide of ways your advice has benefited your clientele?
  • Are you a Women’s Choice Award® Financial Advisor?