How to Select a Financial Advisor: Questions to Ask

Apr 29

Choosing the right financial advisor can make a major difference in achieving your long-term financial goals — yet finding the right fit isn’t always straightforward. Titles like "Financial Advisor" and "Wealth Manager" are widely used, but they don't always reflect a consistent standard of expertise, responsibility, or service.

To make an informed decision, it’s crucial to ask the right questions upfront. Here’s a list of key questions you should ask any prospective advisor — along with why they matter

1. Are you a fiduciary?

A fiduciary is legally obligated to act in your best interest at all times. Not all advisors are fiduciaries. Some only adhere to a "suitability standard," meaning they can recommend products that are simply suitable — even if they’re not the best option for you.

2. What level of registration do you have?

Ask about their licensing level:

Mutual Fund Only Licensed – Entry-level license, limited to mutual funds. Common at bank branches or MFDA firms.
Securities Licensed – Broader investment access beyond mutual funds. Indicates higher proficiency.
Portfolio Manager (PM) – Highest regulatory designation. Allows discretionary portfolio management and carries a fiduciary duty.

This helps you gauge both the range of services they can offer and the level of expertise they bring.

3. How is the relationship with your Investment Dealer structured?

Some firms rely heavily on product commissions or impose sales quotas. Others take a large cut of the advisor’s fees, which can create misaligned incentives. Understanding the dealer’s structure helps uncover potential conflicts of interest.

4. Can you clearly explain your all-in fees?

Total fees matter — not just management fees, but also trading costs, product fees (MERs), and platform fees. A good advisor will be able to break this down simply and transparently.

5. Are you restricted in what products you can use?

Some advisors are tied to proprietary products or limited investment menus. True independence allows access to a much broader (and often better) range of solutions.

6. Are you able to decide your own pricing?

If the advisor can control pricing (within reason), it often means they’re operating with a higher degree of flexibility and independence, rather than following preset corporate fee structures.

7. Do you incorporate alternative investments into portfolios?

Alternative investments (private real estate, infrastructure, private equity, private debt) can enhance diversification and risk-adjusted returns. Find out if the advisor has meaningful access to alternatives — and whether there are restrictions on their use.

8. What are your credentials?

Look for designations like:

CFA® (Chartered Financial Analyst) – the gold standard for investment management expertise.
CFP® (Certified Financial Planner) – strong financial planning credentials.
CPA® (Chartered Professional Accountant) – tax expertise.

Credentials show a commitment to professionalism and higher standards, and not all “letters” at the end of the name are created equal.

9. Do you offer financial planning?

Some advisors focus only on managing investments. Comprehensive planning services (covering retirement, tax, insurance, and estate needs) add significant value.

10. What do your financial plans include?

A good financial plan should cover:

Retirement projections
Tax planning strategies
Investment recommendations
Insurance needs analysis
Estate and legacy planning
Cash flow analysis

11. How often will we meet initially and ongoing?

Clear communication expectations are critical. Ask how often you’ll review progress, update plans, and discuss markets — especially in volatile times.

12. How do you evaluate investment performance?

Performance should be assessed relative to clear benchmarks and aligned with your personal goals, not just arbitrary returns. A good advisor will emphasize risk-adjusted returns and overall progress toward your financial objectives, not just "beating the market."

A Few More Great Questions to Consider:

Will you be my main point of contact, or will I be passed off to a team?
Personal relationships matter. Understand who you’ll actually be working with day-to-day.
What types of clients do you typically work with?
Some advisors specialize in high-net-worth clients, business owners, retirees, or young professionals. It's important that your advisor has experience with situations similar to yours.
How many households do you currently work with?
This gives insight into how much attention and personalized service you can expect. An advisor managing hundreds of households may not be able to offer the same level of care as one working with a smaller, more focused group.
What technology do you use to enhance the client experience?
Tools like dynamic planning software, client portals, and mobile apps can make your experience much smoother.

Final Thoughts

The right advisor should act as a partner, advocate, and guide — helping you make smarter financial decisions, not selling you products. By asking these questions, you can cut through the noise and find someone who truly fits your needs and values.

If you’re considering a second opinion on your financial strategy or simply want to learn more about what an independent, fiduciary-driven relationship looks like, feel free to connect with us at Rivers Wealth — we’re always happy to have a conversation.

Adam Rivers