Question: Trusting someone to handle our finances is a major concern for my husband and me. How can we determine if an adviser is trustworthy? Our current adviser gives off a used car salesman vibe, and we often disregard his advice.
Answer: According to experts, if you find it difficult to trust your adviser, it may be time to seek a new one. "When an adviser comes across as pushy, resembling a used car salesman, it's generally a red flag," explains Lisa Weil, a certified financial planner and founding member of Clarity Northwest. (If you need assistance, you can use this tool to find a financial adviser who matches your requirements.)
To find a new adviser, consider starting by asking your trusted family and friends if they can recommend someone they have worked with. However, keep in mind that even with a strong recommendation, it is essential to thoroughly vet the individual. Weil advises not basing your decision solely on whether someone is nice or personable: "Would you hire a brain surgeon simply because they were likable? The same logic applies to financial advisers."
Finding a Trustworthy Financial Adviser
If you have questions about working with your current financial adviser or are considering hiring a new one, there are several resources you can turn to. One option is to utilize the National Association Personal Finance Advisors' Find an Advisor site or the Garrett Planning Network to search for a qualified adviser. Alternatively, you can use a financial adviser matching service, such as the one offered by SmartAsset.
When choosing a financial adviser, it is crucial to prioritize hiring a fee-only certified financial planner. These professionals are fiduciaries, which means they are legally obligated to put your interests first. They must also pass an exam and accumulate thousands of practice hours. It's important to be aware that not all individuals who refer to themselves as financial planners meet these criteria. Many of them are licensed salespersons whose priorities may not align with your best interests.
To ensure that you find a trustworthy adviser, it's essential to assess their qualifications and expertise. Look for someone who is well-qualified, knowledgeable, and receptive to your specific goals and concerns. Additionally, there needs to be a natural rapport and compatibility personality-wise. If this connection is missing, it may be necessary to continue searching until you find the right match. Remember that while building trust takes time, if it doesn't develop with your adviser, it's crucial to find someone else who can meet your needs.