Finding the Right Financial Advisor in 2024

Embarking on your financial journey to retirement requires thoughtful planning and guidance. Selecting the right financial advisor is pivotal in achieving your goals and securing your financial future. 

With an overwhelming amount of options available (according to the latest U.S. Bureau of Labor Statistics data, there are around 330,300 financial advisors employed in the country.), it's essential to navigate the process of finding the right financial advisor with clarity and confidence.

Discovering a suitable financial advisor typically entails conducting research, gaining insight into your personal financial circumstances, and acquiring some fundamental knowledge about the industry.

This comprehensive guide provides step-by-step instructions to help you choose the perfect financial advisor for your unique needs.

Determine Your Financial Needs

Understanding your financial requirements is the cornerstone of finding the right advisor. Assess your goals, whether it's retirement planning, investment management, estate planning, or tax strategies, identifying your specific needs will guide you in selecting an advisor who specializes in the areas most important to you.

Understand Different Types of Advisors

Financial advisors come in various specialties, each offering distinct services tailored to different aspects of financial planning. Investment managers focus on portfolio management, while financial planners offer holistic advice covering multiple financial areas. Wealth managers provide comprehensive services that encompass both investment management and financial planning. Understanding these differences will help you choose an advisor whose expertise aligns with your goals.

Decide What You're Willing to Pay

Financial advisor fees vary based on the services provided and the advisor's fee structure. Determine your budget and consider whether you prefer a fee-only or fee-based advisor. Fee-only advisors solely earn from client fees, eliminating potential conflicts of interest, while fee-based advisors may receive commissions from third-party products. Understanding these distinctions will ensure transparency in your financial partnership.

Finding Your Financial Advisor

Explore various avenues to find potential advisors, including word of mouth, referrals, and online resources. Seek recommendations from trusted sources, such as friends, family, or colleagues who have had positive experiences with advisors. Utilize online platforms and directories to research advisors in your area and review their credentials and specialties.

Thoroughly vet potential advisors to ensure they meet your standards and align with your values. Inquire about their certifications, experience, and approach to financial planning. Check for any red flags, such as disciplinary actions or conflicts of interest.

Questions to Ask Your Potential Advisor

When meeting with a financial advisor, you should seek as much information as possible, from certifications to fees to their overall investment strategy. Here are some specific questions you might ask during your consultation:

  • Do you operate as a fiduciary?
  • Could you outline your fee arrangement?
  • Do you receive commissions for recommending third-party products or services?
  • Is there a minimum investment requirement?
  • How many clients do you currently serve?
  • Do you have a specific client demographic you primarily work with?
  • How frequently do you schedule client meetings?
  • What guiding principles inform your investment approach?
  • Are there any disclosures on your professional record?
  • Has your team obtained any financial certifications (CFP® CLU® CHFC® RICP®)?
  • Are there additional costs beyond advisory fees I should be aware of?
  • Do you specialize in any particular financial area?

The correct answers are going to depend on your personal needs and what you’re looking for in an advisor.

What Is a Fiduciary?

Out of the 330,300 financial advisors in the U.S.A., there are approximately 15,114 fiduciary investment advisors. Any advisor registered with the SEC is legally required to abide by fiduciary duty and, as a result, must put clients’ interests ahead of their own. According to the SEC, fiduciaries are expected to exercise a duty of care and a duty of loyalty to clients. Any advisor registered with the SEC is legally required to abide by fiduciary duty and, as a result, must put clients’ interests ahead of their own. According to the SEC, fiduciaries are expected to exercise a duty of care and a duty of loyalty to clients, and as a result, are “held to the highest standard of conduct.”

Working with an advisor who abides by fiduciary duty gives you the assurance of knowing they’re legally obligated to put your interests first. While a fiduciary can still have conflicts of interest, knowing that they have a duty of trust and loyalty to you, the consumer, can give you some peace of mind. That’s why most experts recommend asking an advisor whether they abide by fiduciary duty when you first meet with them. 

What Services Can a Wealth Preservation Manager Provide?

Wealth preservation managers are financial professionals who often work with mid to high-net-worth individuals and specialize in helping clients grow, protect, and maintain their wealth over time. Their primary focus is preserving and safeguarding existing assets, managing liability exposure, and devising strategies to pass their wealth on to their designated heirs. 

Key responsibilities and areas of expertise of a wealth preservation manager may include:

  1. Estate Planning: Wealth preservation managers assist clients in developing comprehensive estate plans. This may involve creating wills, trusts, and other legal structures to help ensure their client’s assets are distributed according to their wishes while working to minimize estate taxes and potential disputes. 
  2. Asset Protection: Wealth preservation managers help clients protect their assets from potential threats such as lawsuits, creditors, and other financial risks. This might include strategies like setting up trusts.
  3. Tax Planning: Wealth preservation managers work to minimize tax liabilities through various strategies, which can help clients retain more wealth.
  4. Risk Management: Wealth preservation managers assess and address various financial risks, including insurance needs, to protect against unforeseen events, such as illness, disability, or accidents.
  5. Charitable Giving: Some wealth preservation managers assist clients in structuring charitable giving and philanthropic efforts while maximizing tax benefits.
  6. Retirement Planning: Wealth preservation managers help ensure clients have enough resources to maintain their lifestyle throughout their retirement years without depleting their wealth.
  7. Investment Strategy: While wealth preservation is their primary focus, they may still have a role in managing investments to generate reasonable returns while prioritizing capital preservation.
  8. Wealth Transfer: Preparing for the transfer of wealth to heirs and beneficiaries is a critical aspect of wealth preservation. This includes educating clients about the most tax-efficient ways to pass on their wealth.

NJM Wealth Preservation Strategies

At NJM Wealth Preservation Strategies, we understand the significance of trust and transparency in financial partnerships.

Led by Nic J. McLeod, a dedicated fiduciary, our team is committed to providing honest and knowledgeable guidance tailored to your financial goals. Whether you're planning for retirement, protecting your assets, or navigating complex financial decisions, we're here to support you every step of the way.

Schedule a complimentary consultation today and experience the difference between partnering with a trusted advisor who puts your best interests first.