The Ultimate Guide to Hiring a Financial Advisor
Why This Guide Matters
Every decision we make in life is, at least to some degree, also a financial decision. And given that personal finance is becoming more complicated than ever, this also means that hiring a financial advisor can be one of the most important decisions you make. Your ability to retire, send your kids to college, buy a home, reduce stress, or just feel like you’re finally in control of your money… all of it can hinge on the financial decisions you make.
But let’s be honest: the world of financial advice is confusing. There are dozens of titles that sound the same, hundreds of business models, and way too many people calling themselves “advisors” when they’re really just salespeople in disguise. It’s no wonder people feel overwhelmed or hesitant to reach out for help.
This guide is here to change that.
We wrote this to give you a clear, no-nonsense roadmap to hiring the right financial advisor for your needs, whether you have a seven-figure portfolio or just want help making smarter day-to-day decisions. It doesn’t matter where you are on your financial journey. You deserve access to competent, ethical, and understandable advice.
We’re not here to push you toward any one type of advisor or service. Our goal is to help you understand how the industry works, what questions to ask, and how to spot the difference between someone who’s truly on your side and someone who’s just trying to sell you something.
Let’s get started.
What Is a Financial Advisor, And What Do They Actually Do?
The term “financial advisor” gets thrown around a lot, but it doesn’t always mean what you think it does. In fact, there’s no one-size-fits-all definition and no consistent regulation of the title either. That means someone calling themselves a financial advisor might be a credentialed expert who builds comprehensive plans, or they might be a salesperson working on commission.
So let’s break it down.
Core Services Financial Advisors May Offer
Not all advisors offer the same services, but most fall into a few main categories:
Financial Planning: This is the big-picture work of helping you figure out where you are now, where you want to go, and how to get there. It can include budgeting, retirement planning, tax strategies, insurance needs, estate planning, and more.
Example: An advisor might help a young couple decide whether to buy a home or keep renting, how much to save for future kids’ college, and how to take advantage of tax deductions.
Investment Management: Some advisors manage your investments for you, building and adjusting a portfolio based on your goals and risk tolerance. Others may give investment advice without managing the accounts themselves.
Example: A retiree might hire an advisor to rebalance their portfolio to generate income and reduce stock market risk.
Product Sales: Some people who call themselves “advisors” are really brokers or insurance agents. Their main role is to sell products like annuities, mutual funds, or life insurance, and they get paid when you buy.
Example: Someone offers you a “free” financial plan to support their recommendation of an insurance policy or annuity as the solution, which they receive a commission for when you buy.
Many advisors do a mix of the above. Some offer only planning, some focus on investments, and some combine services. That’s why it’s so important to ask the right questions before hiring anyone.
Niche Specializations: Advisors Aren’t One-Size-Fits-All
Just like doctors or attorneys, financial advisors often specialize in serving specific types of people or financial situations. This can be a huge benefit, because an advisor who works with people like you every day is more likely to understand your unique needs.
Some common niches include:
Young professionals just starting to build wealth who might hire an advisor to help navigate questions around student loans, buying their first homes, budgeting, or employer benefits.
Pre-retirees and retirees seeking guidance on retirement income planning, tax-efficient withdrawals, or optimizing Social Security.
Business owners or self-employed individuals seeking a financial planner for advice on retirement plans like SEP IRAs and solo 401(k)s, entity structuring, insurance, or cash flow management.
Families with special needs children might hire a financial advisor for their experience working with special needs trusts, coordinating government benefits, or setting up and using ABLE accounts.
Professionals in a specific field or company with common planning needs such as tech employees with stock options, military families, or medical professionals.
When an advisor has deep experience in your world, they’re more likely to anticipate issues you might not even know to ask about and to offer advice that’s actually useful, not generic.
Business Models Explained: How Advisors Get Paid (and Why It Matters)
One of the most important things to understand before hiring a financial advisor is how they get paid, because it affects what kind of advice you get, the conflicts of interest that may exist, and the services you can expect to receive (or not) from them. Understanding these distinctions is key to choosing an advisor whose incentives are aligned with yours.
There are a few main ways advisors make money. Some of these models are more transparent than others, and no model is perfect for everyone. What matters most is that you understand how it works, and whether it’s a good fit for your needs and comfort level.
1. Commission-Based
These advisors earn money when they sell you financial products, like mutual funds, annuities, or life insurance. Their role is to serve as a broker or an agent of an investment or insurance company. This is the most common model, by a long shot, but that is starting to change in recent years.
Pros:
May offer a low or “free” upfront direct cost to you
Can be helpful if you need a specific product (e.g., term life insurance or a mutual fund)
In some circumstances, paying a higher upfront sales load can reduce long-term costs
Cons:
High potential for conflicts of interest, as your best option may not be the one that pays them the most which could influence the advice you’re given
Advice may be geared toward selling, not planning. As such, financial advice is also often much narrower in scope
Less transparency, as it’s harder to tell what you’re really paying
May not receive any ongoing planning services once the sale is complete. Or worse, there’s the potential for variations of “churning” into new products periodically
Example: You purchase an annuity or a variable universal life insurance policy, and the agent is paid a commission by the insurance company.
2. Assets Under Management (AUM)
Advisors who use the AUM model charge a percentage of your investments, typically around 1% per year, in exchange for managing your portfolio and (often but not always) offering broader financial planning advice on topics other than your investment accounts.
Pros:
Being paid directly by clients, as opposed to the company whose products they sell, reduces conflicts of interest in the advice they give you
Cost scales with your ability to pay, and you don’t have to make direct payments out of your cash flow
Incentive to grow your portfolio (they earn more as your portfolio grows)
Often includes ongoing advice and support
Cons:
Often much more expensive over time, especially for larger accounts. Probably the highest impact here for accounts in the (very rough) range of $500k - $5 million
Costs don’t scale with the amount of work performed. A client with a $2 million account could pay 4X as much as a client with $500k despite being the same amount of work to manage
Most firms have investment account minimums that exclude people who don’t have substantial assets to manage such as clients who are younger, earn lower incomes, or have their net worth tied up in real estate or a business
Incentives may prioritize portfolio growth even when your goals suggest spending more, reducing risk, or paying off debt
There’s an odd and fundamental mismatch between the way that they charge (investments) and the most impactful service they provide (financial planning)
Example: If you have $500,000 invested, a 1% AUM fee = $5,000 per year.
3. Subscriptions or Retainers
These advisors charge a flat recurring fee, generally in monthly or quarterly installments, in exchange for ongoing financial planning support. Their services might also include investment management within the scope of the engagement, which is one of the ways advisors will use the term “flat fee”. Some advisors will charge every client the same amount, others will adjust it up or down depending on the complexity of a client’s situation, but it will be pre-determined and transparent. Often used with younger clients and those who prefer paying directly out of cash flow rather than from their investment accounts.
Pros:
Encourages ongoing support and engagement, generally with a proactive structured approach to reviewing important financial planning topic areas periodically
Good for clients with changing needs and evolving goals
No minimum account size, or requirement to have the advisor manage your investment accounts
Reduced conflicts of interest in the recommendations they give since they’re paid directly by clients and can recommend any (or no) specific financial products
High transparency, you’ll know exactly what you’re getting and what you’re paying for it
Cons:
Clients could pay for more services than they actually need if an advisor’s process covers topic areas that aren’t currently relevant to your personal financial situation
Services vary widely from one financial advisor to another, so you should ask detailed questions about what they actually do
Potential to mislead clients to stick around for longer even if they don’t actually need help anymore
If the advisor isn’t also managing investment accounts as part of this retainer, then you could still be responsible for doing it yourself (though likely with lots of guidance from them). The same applies to other financial products you may need, such as insurance policies or mortgages.
Example: You pay $250/month for access to quarterly meetings, email support, and an online dashboard tracking your progress and action items.
4. Hourly
Hourly advisors charge by the hour for their time, just like accountants or therapists or most other types of service providers. This model is often used for one-time questions, second opinions, or plan reviews.
Pros:
Very flexible and affordable for simpler needs. Anybody can hire a financial advisor for help with questions big or small, which helps broaden access
Able to work with an advisor on small projects to build trust before moving on to larger ones, it’s not all-or-nothing
Ideal for people who want guidance without a long-term relationship, there’s no ongoing commitment
Can get to work on answering your questions right away; no lengthy or complicated onboarding process needed
Reduced conflicts of interest in the recommendations they give since they’re paid directly by clients and can recommend any (or no) specific financial products
High transparency, you’ll know exactly what you’re getting and what you’re paying for it
Cons:
Can be more expensive for complex cases
The exact cost of services may not be known until after the work is completed and the invoice arrives showing the number of hours. Some advisors will have a floor or ceiling to help mitigate this, as long as the scope of services is clearly defined
Generally does not include investment management services unless under a separate engagement
Less proactive advice unless you initiate follow-ups, and some clients hesitate to reach out for help knowing that they’ll be charged for it
Example: An advisor may charge $250/hour and help you build a simple retirement projection in 3-4 hours.
5. Project-Based Flat Fee
Project-based flat fee financial advisors are very similar to the hourly approach in that they charge the client directly for the work they’ve completed and the amount charged scales with the workload. The difference is that they’ll have a set rate for a specific project, rather than by the number of hours directly. Some projects could be on the smaller side, such as a student loan analysis taking 3 hours, and some could be much larger, such as a full financial plan covering many topic areas with long-term detailed projections taking 20 hours. They’ll usually multiply their hourly rate by an estimate of the number of hours the project will take in order to determine the project fee.
Pros:
Reduced conflicts of interest in the recommendations they give since they’re paid directly by clients and can recommend any (or no) specific financial products
Asset levels don’t matter at all, broadening access to a wider range of clients
Encourages holistic planning rather than product pushing
Even higher transparency than hourly, you’ll know exactly what you’re getting and what you’re paying for it
You’re protected against costs growing higher than expected if it takes more hours to complete the given project scope
Cons:
Can be a high upfront cost for first-timers
Wide range of services can vary widely from one financial advisor to another, so you should ask detailed questions about what they actually do
Generally does not include investment management services unless under a separate engagement
Less proactive advice unless you initiate follow-ups, and some clients hesitate to reach out for help knowing that they’ll be charged for it
You’re potentially paying for more hours of the advisor’s time than you’ve used if it takes fewer hours than expected to complete the given project scope
Example: An advisor may charge $5,000 for a one-time retirement plan that they expect to complete in ~20 hours.
What are “Fee-Only” Financial Advisors?
Being fee-only means the advisor is only paid by you, the client. They don’t earn commissions or kickbacks from investment companies, insurance firms, or anyone else by selling financial products. Their compensation is tied solely to the advice that they give and services they provide, which helps to eliminate many of the most common and egregious conflicts of interest in the industry.
A fee-only financial advisor could operate with any of the models described above except for commissions, but someone offering services under any of those models doesn’t necessarily mean that they’re fee-only. The far majority of fee-only financial advisors operate with an AUM model.
What are “Advice-Only” Financial Advisors?
Advice-only financial advisors are a subset of fee-only, but go a step further. These advisors work under a flat-fee, hourly, or subscription model, and don’t manage your investments or sell products at all. They just give you objective financial planning advice, which you can then implement on your own or with help from someone else.
Their reasons?
To eliminate financial incentives that could influence their recommendations
To make financial advice more accessible for people who are just starting out or prefer to manage their own investments
To keep the relationship focused on your goals, not your portfolio size
They believe it’s the cleanest, most transparent way to serve clients
Focusing on financial planning advice keeps their operating complexity and costs lower since they don’t have to worry about everything that goes into managing clients’ investment accounts or product sales
This advice-only model is currently a tiny proportion of the industry, but is growing quickly because of significant demand from clients.
⚠️ A Note About “Fee-Based”: Not What It Sounds Like
The term “fee-based” sounds a lot like “fee-only,” but it means something different (and potentially misleading).
A fee-based advisor charges fees and may also earn commissions from selling financial products like insurance or mutual funds. In other words, they get paid by you and by third parties, which creates the potential for conflicts of interest.
The term is often used to sound consumer-friendly, but it’s really a hybrid model that combines elements of fee-only planning and commission-based sales. Don’t assume “fee-based” means independent or conflict-free; it doesn’t.
✅ To avoid confusion, you can always ask:
“Do you receive any commissions or third-party compensation in addition to the fees I pay you?”
The Bottom Line
There’s no single “best” compensation model that works for every single client and situation, but transparency matters. Be wary of anyone who can’t clearly explain how they’re paid, the services they do or don’t provide, or who stands to benefit from the advice they give.
In the next section, we’ll talk about fiduciary duty. How someone gets paid is one thing, but whether they’re legally obligated to put your interests first is something else entirely.
Fiduciary vs. Suitability: Who’s Really on Your Side?
Let’s say you’re working with a financial advisor who recommends a certain investment or insurance policy. You’d probably assume that recommendation is in your best interest, right?
Unfortunately, that’s not always the case.
That’s because not all financial professionals are held to the same legal standard when giving advice. In fact, there are two very different standards that apply in the financial industry:
The Fiduciary Standard
A fiduciary is legally required to act in your best interest. Not just suggest something that’s “good enough”, but they must put your needs ahead of their own. This concept is much broader than financial services, there are versions of fiduciary standards that apply to many other fields such as attorneys, real estate agents, trustees, or corporate board members.
The two basic core fiduciary duties that are most relevant to financial professionals include:
Duty of Loyalty, which requires an advisor to put your needs and interests ahead of their own. They must avoid conflicts of interest where possible, and clearly disclose any that do exist. They shouldn’t benefit at your expense or hide things that could influence their advice. For example, a fiduciary can’t steer you toward a higher-cost product just because it earns them higher compensation.
Duty of Care, which requires an advisor to act with competence and diligence. They must be not just well-intentioned, but well-informed. It requires them to thoroughly understand your situation, develop professional expertise, and give advice that reasonably fits your needs. For example, a fiduciary shouldn’t recommend a specific retirement withdrawal strategy without first running the numbers and assessing your full financial picture. Nor should they give advice on topics that they don’t have the appropriate knowledge and experience to do so.
The Suitability Standard and “Regulation Best Interest”
This is a lower bar which simply requires that an advisor or broker recommend products that are generally appropriate for your financial situation, but not necessarily the best or most cost-effective option. As long as a product fits your stated goals and risk tolerance, it’s considered “suitable,” even if there are better alternatives. This lower standard leaves room for recommendations that benefit the advisor more than the client, especially when commissions or sales incentives are involved.
For example, if two mutual funds meet your investment objectives, one with a 1.5% annual fee that pays the advisor a commission and another with a 0.2% fee that does not, the advisor operating under the suitability standard can legally recommend the more expensive option, as long as it’s “suitable.”
FINRA Rule 2111 governs general suitability obligations, while SEC Rule 15l-1 (Regulation Best Interest) covers recommendations of some specific types of securities and investment strategies.
Regulation BI does not apply to other recommendations that might be covered in a financial planning relationship, such as tax strategy or insurance transactions. It also does not extend beyond the purchase of the security they’ve recommended.
The Problem with “Sometimes” Fiduciaries
Here’s where it gets tricky: some advisors wear multiple hats.
For example, many professionals are dual-registered, meaning they’re both an Investment Adviser Representative (held to a fiduciary duty when giving advice) and a registered broker (held to the lower suitability standard when selling products). These individuals might switch between roles during the same client relationship sometimes even during the same conversation.
This is where consumers often get confused. You may think you’re working with a fiduciary advisor, but unless they’re required to act as a fiduciary at all times, that protection isn’t guaranteed.
Similarly, CFP® professionals are required by the CFP Board to act as fiduciaries, but only when they’re providing financial planning. If they’re simply recommending a product without a formal planning engagement, that duty may not apply.
So Who Is A Fiduciary? How to Protect Yourself
Unfortunately, this is a tough question because there are many different versions of fiduciary duties that could apply to a financial advisor. Here’s a summary of a few different types of fiduciary relationships:
Fiduciary type
When it applies
Enforcement
Because of this complicated overlapping system, the best way to ensure your advisor is truly on your side is to ask this question:
✅ “Are you legally required to act as a fiduciary at all times, in all aspects of our relationship?”
If the answer is anything less than an enthusiastic “yes”, dig deeper. Ask when they are and aren’t acting as a fiduciary, and make sure you’re comfortable with those boundaries. You can also look for transparency in how they’re compensated, which ties closely to fiduciary status. Advisors who are fee-only or advice-only generally don’t have the same conflicts of interest as those who earn commissions.
Next, we’ll look at the credentials that can help you identify real professionals in a crowded, confusing industry.
Credentials & Licenses: What Should You Look For?
Just about anyone can call themselves a “financial advisor”, “financial planner”, “wealth manager”, or many other generic titles. Professional credentials are one of the best ways to tell whether someone has the training, experience, commitment to ethical standards, and qualifications to give you real advice.
But not all designations are created equal, and there’s a very wide range. In fact, just FINRA’s list of professional designations shows over 200! Some represent years of study and ongoing education. Others can be earned in a weekend, or are made up entirely by marketing departments.
This section breaks down a few of the most meaningful designations and licenses you’re likely to come across, and how to tell which ones matter.
The Most Respected Designations For Financial Advisors
These credentials are widely recognized in the financial planning and investment community and carry real educational, ethical, and professional standards:
CFP® – CERTIFIED FINANCIAL PLANNER™
Considered by many to be the most credible designation in financial planning. Covers a wide range of financial planning topics including investing, budgeting, estate planning, insurance, retirement planning, and more.
Requires a college degree, extensive coursework in financial planning topics, a 6-hour exam, and 3 years of relevant experience. See this page for an overview of the certification process.
Created and maintained by the CFP Board of Standards, a nonprofit organization that is not a governmental or regulatory authority.
Must uphold a fiduciary duty when providing financial planning.
Certification renewal is every 2 years and requires 30 hours of ongoing continuing education, including 2 hours specifically related to ethics.
You can verify a financial advisor’s certification status on the website.
Look for CFP® professionals if you want well-rounded advice that goes beyond just investments.
CPA/PFS – Certified Public Accountant / Personal Financial Specialist
The PFS designation is available to CPAs who complete additional training in financial planning and pass an exam. Great if you want someone who can integrate advanced tax planning into your overall strategy.
Requires a CPA license plus additional coursework, testing, and experience in personal finance. See the AICPA website for details on the certification process.
Annual recertification requires 20 hours of continuing professional development.
Useful for people who need proactive tax planning and/or tax preparation alongside financial advice, especially those with complex tax situations such as small business income, real estate holdings, or multiple income streams.
EA – Enrolled Agent
The Enrolled Agent credential is granted by the Internal Revenue Service.
Most Enrolled Agents work in tax preparation and/or representing taxpayers before the IRS, but in recent years the credential is becoming more popular among financial advisors looking for a way to increase (and demonstrate) their tax knowledge.
Becoming an Enrolled Agent requires either:
Passing a three-part comprehensive exam covering individual and business tax returns, or
Experience as a former IRS employee
Does not require any training or experience in financial planning training, but EAs can be great team members if your focus is taxes.
Recertification requires 72 hours of qualifying continuing education, including 6 hours of ethics, every 3 year cycle. This must include a minimum of 16 hours per hour, 2 of which must be on ethics.
Contact the IRS to verify the status of an Enrolled Agent.
Learn more about becoming an Enrolled Agent on the IRS website, and see Treasury Circular 230 for regulations governing their practice.
Useful for people who need proactive tax planning and/or tax preparation alongside financial advice, especially those with complex tax situations such as small business income, real estate holdings, or multiple income streams.
CFA® – Chartered Financial Analyst
Widely considered to be the most rigorous credential in investment analysis and portfolio management.
This designation is created and managed by the CFA Institute, a nonprofit organization that is not a governmental or regulatory authority.
Requires passing 3 challenging exams and thousands of hours of study. See the CFA Institute website for details on how to become a CFA. Continuing education is encouraged, but not required.
Most CFA charterholders are portfolio managers or analysts, not focused on comprehensive financial planning.
Excellent way to confirm someone’s investment expertise, but not necessarily a sign of broader planning skills.
ChFC® – Chartered Financial Consultant
Covers a wide range of financial planning topics including investing, budgeting, estate planning, insurance, retirement planning, and more.
Offered through The American College of Financial Services, an accredited institution which has created and manages a wide range of educational programs and credentials in financial services.
Certification requires completion of 8 courses covering various financial planning topics, 3 years of related experience, and a commitment to comply with The American College Code of Ethics and Procedures. Does not require a college degree or passing a national exam. See details of how to become a ChFC on the American College website.
Recertification requires completing 30 hours of continuing education every 2 year cycle, 1 hour of which must be on ethics.
More commonly held by experienced advisors who started their careers in insurance.
Credible and worthwhile as a marker of expertise in financial planning, though not as widely recognized and potentially not as rigorous as the CFP®.
Red Flags: Watch Out for These
Made-up designations like “Certified Wealth Strategist,” “Chartered Retirement Advisor,” or “Registered Financial Consultant” may sound impressive but often require little or no rigorous training.
Proprietary credentials created by firms to sound official (e.g., “Vice President of Retirement Strategy”) often mean very little.
If you’re unsure, search the designation online to learn more about the actual requirements and the certifying body behind it.
Relevant Licenses in Financial Services
Licensing is different from credentialing or certifications. Licenses are legally required to perform certain tasks such as giving investment advice, managing money, or selling financial products.
Here are the key ones to know:
Series 65 – Uniform Investment Adviser Law Exam
Required for individuals who want to give fee-based investment advice as an Investment Adviser Representative (IAR) of a Registered Investment Advisor (RIA) firm.
Passing the Series 65 is often the minimum legal requirement to provide advice for a fee.
The Series 65 exam covers the basics of 4 main topics:
Characteristics of various investment vehicles
Portfolio construction
Macroeconomics
Securities laws and regulations for investment advisers
Financial advisors with some certifications (like CFP and ChFC) may qualify for an exemption in some states.
Series 7 – General Securities Representative License
Series 7 is legally required to sell individual securities like stocks, bonds, and mutual funds as a broker
Must be affiliated with a FINRA-member broker-dealer
Generally held by people working under the suitability standard, not fiduciary
Insurance Licenses
Required to sell insurance products such as life, disability, long-term care, property, and annuities.
Regulated at the state level, so requirements vary.
Putting It All Together
Credentials and licenses tell you a lot about what an advisor is trained and legally allowed to do. Here’s a quick summary:
You Want...
Look For...
How to Choose the Right Advisor for You
Now that you understand what financial advisors do, how they’re paid, and how to evaluate their credentials, the next step is figuring out what you actually need and who’s the right fit to help you with it.
There’s no single “best” advisor out there. The right one for you will depend on your goals, your financial complexity, and your personal preferences. This section will help you narrow your search and avoid wasting time with the wrong fit.
Start with Your Goals
The first question isn’t “Which advisor should I hire?” Instead, start by asking “What do I want help with?”
Here are some common goals that might lead someone to seek financial advice:
Planning for retirement (or early retirement)
Deciding when to claim Social Security or pension benefits
Budgeting, debt repayment, or managing cash flow
Evaluating employee benefits or stock options
Saving for a home, education, or other big goals
Navigating a life transition (marriage, divorce, inheritance, new job, etc.)
Proactive tax planning
Building or adjusting an investment strategy
Creating an estate or legacy plan
Write down your top 2–3 priorities. That list will help you find an advisor who focuses on what matters most to you.
Understand the Level of Service You Want
Do you want a one-time check-in, or someone by your side for years to come? Advisors offer different types of engagements (along with various combinations of these):
One-time project or plan: Great if you have a specific question on a certain topic, or if you want a second opinion on your entire financial plan.
Ongoing planning: Ideal if you want regular updates, reminders, and someone proactively keeping you on track as your life and situation change.
Investment management: Some advisors handle your investments directly, generally through an independent third-party custodian such as Fidelity or Schwab. Others give advice but let you DIY
Financial products: If you need an insurance policy, annuity, reverse mortgage, or some other type of financial product then an advisor may be able to help you get it in place.
Advice-only: You get the plan, tools, and recommendations, but you stay in control of implementation
Also consider how hands-on you want to be. Some people like to dig into the details themselves and just want a roadmap. Others want full support and implementation.
Match Complexity to Expertise
The more complex your situation, the more experienced or specialized your advisor may need to be. For example:
If you have…
Look for an advisor who...
An advisor who regularly works with people in your shoes can save you time, money, and stress by anticipating issues before they happen. Experienced financial advisors tend to focus on just a few types of clients, there’s just too much to know to be able to work with everybody effectively. Just like you probably wouldn’t go see a cardiologist for a problem with your hand, you might not want to go see a financial advisor who focuses on small business owners if you’re a military retiree.
Planning for People with Modest Means
Financial planning isn’t just for the wealthy.
If you're early in your career, working toward financial stability, or just don’t have much saved yet, you still deserve (and can get!) competent advice.
Look for advisors who:
Charge by the hour or through recurring subscriptions, rather than by investment management fees.
Don’t also manage investments, or if they do, then don’t have a minimum investment account size.
Put education first and try to empower their clients to make their own infor.med decisions instead of providing higher levels of service done for them
Will work with you on just the scope of questions that you know you need help with, rather than requiring that you do more comprehensive planning on a wider range of topics.
Don’t specialize in a specific or more complex area.
Are used to working with people who are just getting started.
Won’t talk down to you or treat you as less important than their other clients.
Fit Matters: Don’t Ignore Gut Feel
Credentials and pricing are important, but so are comfort and communication. A great advisor should make you feel respected, listened to, and understood.
Ask yourself:
Do they seem to work with people like me?
Do they explain things clearly, without jargon or condescension?
Do I feel like I can be honest with them?
Are they more focused on my life, or on my money?
Do they treat me like a person first, or a spreadsheet?
If the vibe feels off, keep looking. The right advisor won’t just help you grow your finances. They’ll help you feel more confident, less stressed, and more in control.
Next up: behavioral finance, because even the best plan in the world can fall apart if emotions get in the way.
Behavioral Finance: The Hidden Value of Advice
It’s easy to think that financial success is all about knowing the right numbers, making the best investments, or finding the perfect strategy. But in reality, how we think and feel about money often matters just as much, if not more, than the spreadsheets and plans.
This is where behavioral finance comes in. It’s the study of how human emotions and mental shortcuts influence our financial decisions, and why we often act in ways that go against our own best interest.
Why Smart People Still Make Costly Mistakes
Even the most intelligent people fall into common traps, like:
Buying high and selling low out of fear during market downturns.
Avoiding financial decisions due to stress, shame, or overwhelm.
Chasing the latest investment trend based on headlines or hype.
Holding too much cash out of fear of investing, or investing too aggressively out of fear of missing out.
Underestimating complexity of the tax system or other areas, leading to errors and missed opportunities.
Ineffective communication with a spouse, child, business partner, or other important person, leading to more disputes and misunderstandings.
These behaviors can erode wealth and create long-term setbacks even when someone technically “knows better.”
A Good Advisor Is a Thinking Partner, Not Just a Planner
One of the most underrated benefits of working with a financial advisor is having someone in your corner who helps you stay calm, stay focused, and stay on track, especially when things get emotionally charged.
A good advisor helps you:
Pause before reacting to scary headlines or big market moves
Talk through tradeoffs when facing a tough financial decision
Build realistic expectations around risk, returns, and progress
Revisit your goals when life changes or obstacles show up
Actually follow through on the things you said were important
This kind of support is especially valuable during times of uncertainty, like job transitions, bear markets, a health scare, or major family changes. In those moments, the plan matters, but your ability to stick with the plan matters even more.
Coaching, Not Just Calculations
Some advisors explicitly incorporate behavioral coaching into their process. Others do it more subtly by creating a safe space for open dialogue, by checking in when clients start to drift, or by helping you define success on your own terms rather than someone else’s.
If you’ve ever struggled with procrastination, decision fatigue, money anxiety, or “just not doing the things I know I should,” you’re not alone. And a good advisor can help you bridge the gap between knowing and doing.
Coming up next: how much financial advice actually costs, what to expect at different price points, and how to spot hidden fees before they catch you off guard.
What Does Financial Planning Actually Cost?
If you’ve ever looked into hiring a financial advisor and thought, “I have no idea what this should cost” then you’re not alone.
Financial planning isn’t like buying a car or a new phone, where prices are posted clearly and you can compare models side-by-side. The cost of working with an advisor can vary depending on what they offer, how they charge, their experience level, and how complex your needs are.
This section breaks down the most common pricing models and what you can expect to pay, so you can budget realistically and avoid surprises.
Common Fee Structures and Typical Ranges
Let’s revisit the main pricing models you might encounter, this time focusing on actual dollar amounts:
Model
Typical Cost Range
What You Usually Get
Hourly
Flat-Fee Project
Ongoing Subscription/Retainer
AUM (1%)
Commission-Based
What Affects the Cost?
Several factors influence how much you’ll pay for financial advice:
Your situation: More complex situations generally require more work, more experience, and higher risk to the advisor. Advisors often charge more for clients with more complicated situations such as equity compensation, small businesses, or estate tax planning needs.
Level of service: Are you getting one-time advice or an ongoing relationship? Will they implement recommendations for you or hand you a plan to DIY? Some advisors offer modular planning so you can start small and add other topics on later
How the advisor charges: As discussed earlier, fee-only and advice-only models tend to be more transparent. Commission-based models can feel “free” but often carry hidden costs.
Specialization: If you’re a senior executive for a massive publicly traded company, for example, then you can expect a financial advisor who focuses on other executives at your company to charge more since they’ll be experts in relevant topics like your deferred compensation plan and equity incentive plan.
Experience & certifications: Just like any other service provider, financial advisors with more experience and/or more certifications are likely to charge higher rates (and to be worth it).
Don’t Forget About Hidden Fees
It’s not just about what you pay the advisor directly. Make sure to ask about underlying product or platform fees, including:
Expense ratios on mutual funds or ETFs
Trading or custodial fees (especially with investment managers)
Annuity or insurance product costs (these can be very high)
Third-party software or platform fees (sometimes passed through to clients)
A good advisor will be up front about all of these. If someone can’t (or won’t) clearly explain what you’re paying and how they’re compensated, that’s a red flag.
The Real Question: What Are You Getting in Return?
Cost matters, but so does value.
Think about what the advisor is helping you with. If good advice:
Helps you avoid a six-figure tax mistake,
Keeps you from selling in a panic during a market drop,
Gets you on track to retire years earlier,
Or simply brings peace of mind...
...then the right advisor may be worth far more than what they charge.
Remember, it’s your money and your life! You have every right to understand exactly what you’re paying, why, and what you’re getting for it.
Next, we’ll look at what a good financial plan actually looks like. Because once you’re paying for advice, it’s fair to ask: “What am I getting back?”
Sample Deliverables: What You Should Expect from a Good Plan
Once you’ve hired a financial advisor, what exactly do you get? A few conversations and a to-do list? A 200-page document of charts and graphs? An app login?
Whatever the format, your financial plan should feel relevant, clear, and actionable. If it just gathers dust or feels like a generic printout, that’s not a great sign.
This section shows what quality deliverables typically look like, so you know what to expect and how to tell if you’re actually getting your money’s worth.
What’s Included in a Comprehensive Financial Plan?
Most good advisors will address the following areas, tailored to your specific situation:
Net Worth & Cash Flow Overview: A snapshot of what you own, owe, earn, and spend, along with recommendations for improving savings or reducing debt.
Goal-Based Planning: Specific timelines and savings targets for things like retirement, home buying, education, travel, or major life transitions.
Investment Strategy: Guidance on portfolio structure, risk tolerance, asset allocation, and account selection (e.g., Roth vs. traditional IRA).
Tax Planning: Strategies to reduce your current and future tax liability (e.g., Roth conversions, tax-loss harvesting, capital gains planning).
Insurance Needs Review: Analysis of coverage gaps or overlaps in life, disability, long-term care, health, and property insurance.
Estate & Legacy Planning: Help understanding or organizing wills, trusts, powers of attorney, and beneficiary designations.
Employee Benefits & Stock Compensation: Support evaluating 401(k) plans, stock options, RSUs, ESPPs, HSAs, etc.
Action Plan: A prioritized list of next steps so you know what to do and how to do it.
What Does It Look Like?
Plans can be delivered in many formats:
Format
Good Signs
Red Flags
PDF or printed plan
One-page snapshot
Interactive dashboard
Email follow-up & checklists
What matters most are clarity and relevance. A good plan should answer your questions and reflect your life, not just fill space with charts and numbers.
Ongoing Deliverables: Not Just a One-and-Done
If you’re working with an advisor on an ongoing basis, you should expect regular updates and check-ins. These might include:
Updated projections or tax strategies each year
Review of changes in your life (income, job, goals)
Monitoring of spending/saving vs. plan targets
Ongoing access to email support or brief check-in calls
New recommendations as laws or markets shift
Some advisors also offer:
Client portals where you can track progress
Meeting summaries after each check-in
Automated reminders for upcoming tasks or deadlines
The goal isn’t to overwhelm you with information, it’s to keep your plan alive and evolving as your life changes. The written financial plan itself is generally much less important than staying engaged in the financial planning process.
A Word About “Boilerplate” Plans
Some firms generate what looks like a financial plan, but it’s really just a fancy template with your name plugged in. These “boilerplate” plans are often full of generalized advice that sounds impressive but isn’t actually tailored to you.
Here’s how to spot them:
You can’t find anything in the plan that reflects your specific goals, preferences, or tradeoffs
It reads like a sales pitch for insurance or investment products
It’s long, but you still don’t know what you’re supposed to do next
You deserve better. A good plan should feel like it was made for you, because it was.
Coming up: understanding how financial advisors are regulated, who’s actually watching over them, and what protections you do (and don’t) have as a client.
Legal Protections and Regulation: Who’s Watching Your Advisor?
If you're trusting someone with your financial future, you’d hope there's a watchdog making sure they act responsibly. And while there are rules, licenses, and regulators in the financial services industry, the system is more fragmented than many people realize.
Unlike doctors, attorneys, or accountants, who are governed by a single state board or license, financial professionals are regulated by a mix of federal agencies, state regulators, and self-regulatory bodies. And which ones apply depends on what the advisor does, how they’re paid, and what licenses they hold.
Who Regulates Financial Advisors?
Here’s a breakdown of the major regulatory players and what they oversee:
Regulator
Oversees...
SEC (U.S. Securities and Exchange Commission)
State Securities Regulators
FINRA (Financial Industry Regulatory Authority)
State Insurance Departments
IRS (Internal Revenue Service) and State Tax Agencies
Federal Reserve Board, FDIC (Federal Deposit Insurance Corporation), CFPB (Consumer Financial Protection Bureau), OCC (Office of Comptroller of the Currency), and others
An advisor may be subject to oversight by multiple regulatory authorities depending on the type of firm(s) they work for, the licenses they hold, and the products/services they deliver to clients. So if your advisor manages investments under an RIA, they’re likely regulated by either the SEC or a state securities agency. If they’re selling mutual funds or annuities, they may also be regulated by FINRA and/or a state insurance board.
One common misconception to clear up: the CFP Board of Standards sets and enforces the requirements for CERTIFIED FINANCIAL PLANNER® certification, but is not a regulatory body.
What Legal Standards Must Advisors Follow?
The licenses that a financial advisor holds, the type of firm they work at, and the services/products offered all determine which standard of care an advisor is legally required to follow:
Fiduciary standard (RIAs and their IARs): Must put your interests first at all times when giving advice.
Suitability standard (broker-dealers and many insurance agents): Must recommend something “suitable” for you, but not necessarily the best option.
Hybrid advisors (dual-registered): May act as a fiduciary sometimes and a salesperson at other times, depending on the context.
As discussed in Section IV above, this is why it’s so important to ask whether your advisor is a fiduciary at all times.
What Happens If Something Goes Wrong?
If you believe your advisor acted in bad faith, gave negligent advice, failed to perform their duties, or misrepresented something important, you have a few avenues for action:
File a complaint with the advisor’s supervisor or compliance department. This is an important first step, and is likely to resolve most issues.
File a complaint with the SEC or your state securities regulator (for RIAs) at this link.
File a complaint with FINRA (for brokers) at this link.
File a complaint with the CFP® Board (if the advisor holds that designation) at this link.
Consider legal action for serious cases involving fraud, breach of fiduciary duty, or financial harm.
You can also research an advisor’s regulatory and disciplinary history before hiring them, here are a few good places to start:
BrokerCheck by FINRA for broker-dealers at this link.
Investment Adviser Public Disclosure (IAPD) – for RIAs and IARs at this link.
CFP Board’s Disciplinary Database – for ethics violations by CFP® professionals at this link.
What Consumer Protections Are Missing?
Despite the oversight that exists, here are a few (of the many!) examples of some important protections that still fall through the cracks:
The term “financial advisor” isn’t regulated. Anyone can use it, regardless of qualifications.
Sales-based professionals aren’t always required to act in your best interest.
Regulatory complexity makes it hard for consumers to know who’s truly on their side.
The tangled landscape of regulators and quasi-regulators create gaps and overlaps in oversight, and make progress much more difficult.
That’s why education, transparency, and clear questioning matter so much. As a consumer, you need to go beyond the title and understand the structure behind it because not all advice is created equal.
In the next section, we’ll explore the growing shift toward virtual vs. in-person financial advice and what to expect from each approach.
Virtual vs. In-Person: How Do You Want to Work With Your Advisor?
Thanks to evolving technology and client preferences, working with a financial advisor doesn’t require sitting across from someone in a local office anymore. In fact, many advisors today work virtually, serving clients all over the country (or even the world) via video calls, online portals, and digital tools.
But just because virtual is more common doesn’t mean it’s the right choice for everyone. This section compares virtual and in-person relationships, so you can decide what fits best with your style, schedule, and comfort level.
Virtual Financial Advisors
These advisors work remotely and typically meet with clients via some combination of video chats, phone calls, and secure messaging. Deliverables are shared digitally, and documents are signed electronically.
✅ Pros:
Access to a wider pool of advisors so you’re not limited to who’s nearby.
Often more flexible scheduling such as evenings, weekends, etc.
May be more cost-effective since there’s no office overhead.
Easier to fit into your life without leaving time for driving, parking, or sitting in waiting rooms.
🚫 Cons:
Can feel less personal or relational for some people
Requires comfort with technology
Harder to build rapport and trust for some clients or advisors
💡 Examples of When Virtual Might Be Ideal:
You want to work with a specialist (e.g., equity comp, military families) who doesn’t live near you
You have a busy schedule or live in a rural area with few local options
You’re comfortable with technology and like being able to manage everything digitally
You value convenience, flexibility, and a wider range of advisor options
You’ve moved to a new area and want to keep your old advisor instead of finding someone new
In-Person Financial Advisors
These advisors operate from a physical office and typically meet with clients face-to-face, though many offer hybrid options that blend in-person and virtual touchpoints.
✅ Pros:
More personal connection, it can be easier to build trust and communicate.
Helpful for clients who prefer paper documents and physical deliverables, and may be uncomfortable using tech or managing accounts online.
Ideal for complex, high-trust situations like estate planning or family meetings.
A local financial advisor is more likely to be able to refer you to other types of professionals in your area (tax preparer/estate planning attorney/real estate agent/etc) that they regularly collaborate with.
A local financial advisor is more likely to be familiar with unique considerations for your area, such as local taxes or the employee benefits systems for major employers in your area where they have other clients.
🚫 Cons:
You’re limited to the much smaller pool of advisors in your area.
Less schedule flexibility.
May come with higher overhead costs due to maintaining office space.
💡 Examples of When In-Person Might Be Ideal:
You’re more comfortable with paper documents and in-person conversation.
You want to involve other people in meetings such as a spouse or your parents (assuming they’re also in the area).
You have a long-term, ongoing relationship and value face time.
You’re navigating emotionally sensitive or complex decisions and want a human presence.
You want a financial advisor who’s deeply involved in your community.
Hybrid Relationships: The Best of Both?
Many advisors today offer a hybrid approach of meeting virtually most of the time, but available for occasional in-person meetings or events if you’re local.
A hybrid financial advisor can give you the efficiency of virtual, the connection of in-person, and the advantages of a local expert. It’s especially useful if you value face time but don’t need it all the time.
Bottom Line: Choose Based on Your Comfort and Priorities
The best choice comes down to how you prefer to communicate and build relationships.
There’s nothing wrong with wanting to shake someone’s hand, and nothing wrong with managing your entire financial life from your laptop. What matters is that the advisor communicates clearly, uses secure systems, and makes you feel heard whether that’s over a conference table or a screen.
Up next: What tech tools should a modern advisor use, and what does that mean for your experience as a client?
Advisor Tech Stack: Tools That Support the Relationship
A great financial advisor isn’t just someone with strong credentials and good bedside manner, they also need the right tools to deliver advice efficiently, securely, and clearly. Today’s best advisors use technology to simplify your experience, not complicate it. It’s common for modern financial advisory firms to have 2-3 dozen tools in their tech stack, a few of which you’ll also be directly using or seeing as the client.
Whether you're working virtually or in person, here's a look at the tech tools you might encounter and what they mean for you as a client.
What Tools Do Modern Advisors Use?
While every firm is different, and the technology is constantly changing, most client-focused advisors today use a combination of tools that fall into these categories:
🔍 Financial Planning Software
This is where your actual plan lives in the form of projections, charts, “what-if” scenarios, and more. Good planning software helps advisors model your future, test tradeoffs, and visually show you the impact of different decisions. Most of these tools connect to your external financial accounts to automatically update your balances and investment holdings.
Common examples:
RightCapital: Easy-to-understand visuals and sliders, modular approach to different planning topic areas. Hybrid cash flow-based & goal-based planning.
eMoney: Robust and powerful, in-depth cash flow based planning.
MoneyGuide: Goal-based planning tool.
What this means for you: You should be able to see things like retirement projections, cash flow estimates, or savings goals modeled clearly, usually in a shareable dashboard or client portal.
🔐 Practice Management, Client Onboarding, File Sharing
These platforms let you upload and access documents, track tasks, and sometimes view your entire financial picture in one place.
Common examples:
PreciseFP, JotForm, CircleBlack, or Flextract can be used for secure data gathering and onboarding
Wealthbox, Redtail, SalesForce, Tamarac are popular CRM systems used by advisors for managing client information
Google Drive, ShareFile, Dropbox, or Egnyte – for encrypted document sharing
What this means for you: No more emailing tax returns or account statements. A good client portal helps protect your privacy while keeping things organized.
💬 Communication & Collaboration Tools
Advisors are using tools beyond email to improve how they stay in touch and share insights.
Common examples:
Zoom, Google Meet, or Microsoft Teams for virtual meetings
Asana, Trello, Notion, or Monday are used by some advisors for tracking follow-up tasks and accountability
Calendly, Acuity, or ScheduleOnce make scheduling meetings easy without back-and-forth emails
What this means for you: You can expect more flexible and transparent communication. The goal is less friction, not more tech for tech’s sake.
📊 Specialized Analysis Tools
These tools generally go deeper into planning around specific topic areas than the generalized financial planning tools listed above, and may be used as either a replacement or supplement to them.
Common examples:
Holistiplan, Bloomberg BNA, or FP Alpha for reviewing tax returns and identifying tax planning opportunities
IncomeLab, IncomeSolver, or Retirement Analyzer assist with modeling retirement income planning strategies
Vanilla, Wealth.com, or Yourefolio help analyze complicated estate planning scenarios
Morningstar, Kwanti, or YCharts for investment data and analysis
CollegeAidPro, CSLATech, or PayForEd assist with education planning
MyStockOptions, Trayecto, and Gemifi for modeling equity compensation strategies
What this means for you: If your advisor is giving advice in any of these areas, these tools can help them back up their recommendations with real analysis and not just gut feelings. As with the general financial planning software tools above, you will have to give them the information needed to put into these tools.
What to Look for as a Client
You don’t need to become an expert in financial software (even advisors can’t always be with the constant changes), but you should expect:
Secure systems for sharing sensitive information
Clear visual explanations of your plan and options
Easy ways to schedule meetings, ask questions, and track action items
Tools that enhance, not replace, the relationship
If an advisor is relying solely on PDFs and spreadsheets, or if they don’t offer a secure way to share your data, then that’s worth asking about. On the flip side, if everything feels overly complicated or like it’s designed more for their benefit than yours, that’s a red flag too.
Coming up next: how to actually find a good advisor, where to search, and how to filter out the noise.
Where to Find Great Advisors (Beyond Google)
If you’ve ever typed “financial advisor near me” into Google and immediately felt overwhelmed, you’re not alone. The internet is full of listings, paid ads, and company websites that all look the same, and it’s hard to tell who’s actually qualified, objective, or a good fit for you.
Here’s the good news: you don’t have to rely on search engines or AI chatbots. There are several vetted directories and professional networks that make it easier to find qualified, trustworthy advisors based on what you need and how you want to work with them. You can start your search in these places, then look up more information about advisors you’re interested in by checking out other resources like their websites or LinkedIn profiles.
Keep in mind that given the similarities between these organizations, you’ll likely find that the same advisors are listed in several different places.
Here are some of the best places to start your search for a financial advisor:
AdviceOnly
Website: adviceonly.com
A directory of advice-only financial advisors who provide financial planning without managing investments or selling financial products
All advisors on the platform are fiduciaries at all times and subject to several different types of fiduciary standards.
To be accepted for membership with AdviceOnly, they must undergo an evaluation of their professional qualifications including experience, certifications, and education.
All AdviceOnly members are Investment Advisor Representatives (IARs) of the AdviceOnly Registered Investment Advisor (RIA), which means they’re subject to regular oversight by our compliance department. The other directories mentioned in this section are made up of advisors working for many different firms (or running their own), meaning that they’ll each have their own compliance standards and methods of oversight.
All offer some combination of hourly, flat-rate project, or subscription-based service models at your choice, with no asset minimums and no pressure (or even ability!) to move your money
AdviceOnly.com is designed to make it easier to find trustworthy advice from planners who focus solely on giving guidance, not selling products or earning commissions. You stay in control of your accounts, and the advisor gives you clear recommendations to follow on your own (or with another provider if needed).
✅ Great for: People who want clear and competent financial advice without handing over their investment accounts
🚫 Not ideal if: You’re looking for full-service investment management or product-based solutions
NAPFA (National Association of Personal Financial Advisors)
Website: napfa.org
All members are fee-only fiduciaries.
Must meet rigorous education, experience, and ethics requirements to become NAPFA-registered financial advisors, including being a CFP®.
Focus on comprehensive financial planning, not product sales.
Work for a wide range of firm sizes, from solo to thousands of employees.
✅ Great for: High-quality, credentialed advisors who work in a fiduciary capacity at all times
🚫 Not ideal if: You're looking for hourly or project-based work at a lower budget, since most NAPFA members work on an AUM model
XY Planning Network
Website: xyplanningnetwork.com
Many XYPN advisors specialize in serving Gen X and Gen Y clients, though that’s not a hard requirement.
Many offer flat-fee or subscription-based models alongside investment management services.
Nearly all XYPN members have started their own firms, rather than working for a larger one. They all have access to a wide range of support services from XYPN to help run their firms.
Most are virtual and tech-savvy, and tend to skew younger than the average advisor.
All are fiduciary, fee-only, and have completed CFP® certification.
✅ Great for: Younger clients looking for ongoing support without an asset minimum
🚫 Not ideal if: You want the support that comes with larger firms or have complex ultra-high-net-worth planning needs
Garrett Planning Network
Website: garrettplanningnetwork.com
Known for being early pioneers in offering hourly and project-based financial advice, though that focus has shifted over time and many Garrett members now also offer investment management.
Nearly all Garrett members have started their own firms, rather than working for a larger one. They all have access to a wide range of support services from Garrett to help run their firms. On average, they tend to be older and more experienced advisors.
Advisors are fee-only and fiduciary, but compensation models and service models will vary.
✅ Great for: DIY investors, early-career professionals, or anyone seeking a second opinion
🚫 Not ideal if: You want the support that comes with larger firms or have complex ultra-high-net-worth planning needs
FeeOnlyNetwork
Website: feeonlynetwork.com
Directory of independent, fiduciary, fee-only advisors across the U.S.
Assists advisors with online marketing efforts, but does not provide other types of services to help run their practices.
Vets the qualifications of advisors through their association with NAPFA, XYPN, Garrett Planning Network, Alliance of Comprehensive Planners, AdviceOnly Network, or AdviceOnly.
Searchable by location, specialties, and service model
✅ Great for: A general search across many well-qualified fee-only advisors
🚫 Not ideal if: You’re unsure how to vet differences between listings
AdviceOnly Network
Website: adviceonlynetwork.com
The largest directory of advice-only financial advisors, including listings from financial planners at a wide range of independent firms. Good filtering and sorting features to help you find the right advisor for you.
All are verified to be advice-only. No product sales, no investment management.
All members are fee-for-service fiduciaries who charge flat, hourly, or subscription fees
No reviews of certifications, experience, or other qualifications aside from verifying advice-only business model.
Serves as primarily a directory to support online marketing efforts of independent advisors, provides limited additional support to run their practices.
✅ Great for: People who want financial planning help without giving up control of their investments
🚫 Not ideal if: You want your advisor to manage your money for you, or want the additional support that often comes with larger firms.
CFP® Board Directory
Website: letsmakeaplan.org
Search tool for verified CERTIFIED FINANCIAL PLANNER™ professionals. Likely the largest directory of financial advisors.
Includes advisors at a wide range of firms, with a wide range of service models and business models.
Enables filtering by location, investible assets, or specialization.
Keep in mind: Not all CFP®s are fee-only or fiduciary at all times.
✅ Great for: Verifying credentials or narrowing down CFP® professionals in your area
🚫 Not ideal if: You want to filter by compensation model or service model
Next, we’ll walk through the key questions to ask before you hire so you can feel confident before signing anything or moving forward.
Questions to Ask Before You Hire
Before you choose a financial advisor, it’s worth slowing down and asking a few pointed questions. You don’t need to be confrontational, but you do want to be clear. You have a right to ask reasonable questions to understand how the advisor works, what experience they have, what they charge, and whether they’re truly acting in your best interest.
You don’t have to ask all of these questions at once, but use this list as a starting point to guide your conversations and compare different advisors objectively. If someone dodges questions, talks down to you, or brushes off your concerns, that’s a sign to keep looking.
Here are some of the most important questions to ask, grouped into categories to help you cover all the key bases.
📋 Process & Service
These questions help you understand what it’s like to work with the advisor, what’s included, and how they deliver advice.
What does your process look like from the first meeting through implementation?
How often will we meet or check in? Can I contact you between meetings if something comes up? What should I expect as a reasonable response time?
What types of planning do you offer? Do you focus on just investments, or do you cover taxes, retirement, insurance, estate planning, etc.?
Do you provide a written financial plan? If so, can you show me a sample?
Do you deliver recommendations by email, online portal, live meetings, printed documents, or some other method?
Do you implement the recommendations for me, or will I need to take action on my own?
Do you offer ongoing planning or just one-time engagements?
What kind of tech tools or client portal do you use? Will I have access to those?
If I want to leave in the future, is there a cancellation process or refund policy?
How many clients do you work with?
✅ What you’re looking for: A well-defined, client-friendly process with deliverables, clear communication expectations, and no surprises.
🤝 Philosophy & Fit
These questions are about alignment, comfort, and whether the advisor really gets you - not just your finances.
Who is your typical client? Do you specialize in working with people like me?
How do you define success for your clients?
What financial philosophies guide your advice (e.g., budgeting, investing, debt, tax strategy)?
How do you help clients navigate emotional or behavioral challenges with money?
Do you work with couples or families, or just individuals?
What makes you different from other advisors I might be considering?
How do you stay up to date with industry changes, tax laws, and financial best practices?
✅ What you’re looking for: Comfort, mutual respect, and thoughtful answers. You want an advisor who listens, communicates clearly, and understands your priorities, not someone with a one-size-fits-all pitch.
🔍 Ethics & Alignment
These questions help you understand whether the advisor is legally and ethically aligned with your interests, and how they're compensated.
Are you a fiduciary at all times in our relationship?
Are you fee-only or advice-only? Or do you receive commissions or third-party compensation?
How are you paid, and how much should I expect to pay each year?
Do you sell any financial products (like insurance or annuities)?
Are there any situations where your recommendations might benefit you financially?
Do you receive referral fees or revenue sharing from other companies or professionals?
Can I see a sample client agreement or engagement letter before we start?
Are there any potential conflicts of interest I should know about?
✅ What you’re looking for: Clear, direct answers with no defensiveness. Any advisor should be able to explain their compensation and ethical obligations with total transparency, whatever those answers are for their business model.
Up next: how to recognize red flags in the advisor world and protect yourself from bad actors.
Red Flags to Watch Out For
Not all financial advisors are the same. Some may be more focused on selling you a product than solving your problem. Others may mean well but lack the qualifications or experience to truly help.
Here are the most common red flags to watch for and why they matter:
🚩 Uses a Lot of Jargon or Makes You Feel Intimidated
Some advisors use complex language as a smokescreen, or talk down to clients to assert control and sound impressive.
✅ A good advisor should help you feel informed and empowered, not confused or pressured.
🚩 Overpromises on Investment Returns or Guarantees
No advisor can consistently “beat the market,” time recessions, or guarantee returns beyond what the underlying investments can support. Be especially wary of:
Promises of high returns with low risk
Claims that “this strategy works in any market”
“Back-tested” strategies that sound too good to be true
✅ A good advisor will be realistic about uncertainty and help you plan for a range of outcomes.
🚩 Ignores One Spouse or Partner
If you’re meeting with an advisor as a couple, and they consistently speak only to one person, especially the higher-earning or more financially confident partner, it’s a red flag.
This can show up as:
Making eye contact and directing conversation toward only one spouse
Assuming who “manages the money” without asking
Dismissing the other partner’s questions or concerns
Using language like “You’ll explain this to your spouse later, right?”
This kind of behavior can lead to major misunderstandings, resentment, unequal power dynamics, and bad financial decisions that don’t reflect the goals of the whole household.
✅ A great advisor knows how to facilitate healthy communication and make both people feel heard, included, and empowered, regardless of their financial knowledge or personality.
🚩 Evasive or Vague About Compensation
If an advisor can’t clearly explain how they get paid, or brushes off your questions about fees, that’s a major concern.
“Don’t worry about that, it’s all taken care of through the investments”
“The company pays me, not you”
“I don’t charge you anything out of pocket”
These are signs you’re probably being sold a commission-based product or that costs are buried in layers of fees. Nobody works for free!
✅ What to look for instead: A clear, upfront explanation of how they’re paid and what it will cost you.
🚩 Not a Fiduciary (or Only a Part-Time One)
Advisors who aren’t fiduciaries at all times may be allowed to recommend products that benefit them more than you. Some may even act as a fiduciary during parts of your engagement and a salesperson during others, without making that clear.
✅ Ask directly: “Are you a fiduciary at all times during our relationship?”, or “Which types of fiduciary standards are you subject to?”
🚩 Leads With Products and/or Investments, Not Planning
If the first meeting ends with a pitch for a specific annuity, insurance policy, or mutual fund, without a deep understanding of your financial situation and goals, that’s a problem.
✅ Look for advisors who start with questions, not answers. Planning should come before any recommendations.
🚩 Lacks Credentials, Licensing, or a Regulatory Footprint
Anyone can call themselves a “financial advisor.” Similarly, terms like “financial coach” don’t really have any meaning at all. If you can’t verify their credentials or find them in regulatory databases, that’s a red flag.
✅ Use tools like BrokerCheck, IAPD, and the CFP® Board directory to confirm their background, licenses, and certifications, and to give you a heads up on any possible past disciplinary actions.
🚩 Generic Plans or Cookie-Cutter Advice
If your “plan” feels like a templated PDF that could be handed to anyone, without personal context or actionable steps, then it’s not real planning. Similarly, your financial advisor shouldn’t put their own personal values or goals above yours. Their role is to help you make more informed decisions, not to tell you what to do.
✅ A solid financial plan should reflect your goals, lifestyle, and tradeoffs, not anybody else’s.
If you spot one or more of these red flags, don’t be afraid to walk away. There are many excellent advisors out there who lead with ethics, transparency, and client-first service. The key is finding someone who earns your trust and keeps it.
Next, we’ll walk through what it’s actually like to begin working with an advisor, from your first conversation to implementing your plan.
What to Expect When You Start Working with an Advisor
You’ve found an advisor you trust. You’re ready to get started. Now what?
Building a financial plan will definitely require your active involvement in gathering information and talking things through with your advisor. There’s no way around it, you will have to do some work! But whether you’re paying for a one-time plan or entering an ongoing relationship, the process should feel collaborative, clear, and aligned with your goals rather than rushed, confusing, or overwhelming.
Here’s what typically happens once you begin working with a financial advisor.
🗓️ Step 1: The Discovery Meeting
It all starts with a conversation. This initial meeting helps your advisor get to know your story and learn what matters most to you, what challenges you’re facing, and where you want to go.
You’ll likely talk about:
Income, expenses, savings, and debt
Short- and long-term goals (retirement, home purchase, starting a business, etc.)
Your family, values, and financial responsibilities
Previous experiences with money (both good and bad)
This is your chance to evaluate whether the advisor communicates clearly, listens well, and makes you feel comfortable. Sometimes this meeting will occur before you’ve even signed the agreement to officially become a client, and most advisors offer this meeting for free or include it in the onboarding fee.
📂 Step 2: Data Gathering and Goal Clarification
Next, your advisor will ask you to share key documents to paint a full picture of your financial life. These may include:
Tax returns
Pay stubs or income reports
Investment, bank, and retirement account statements
Loan and mortgage information
Insurance policies
Estate documents (wills, trusts, powers of attorney)
Budgets or cash flow records (if available)
You’ll also work together to clarify your goals and priorities in more detail than when you first met. Your advisor may ask:
What’s most important to you financially right now?
What would “financial freedom” look like?
How do you want to balance today’s needs with tomorrow’s dreams?
What keeps you up at night?
This step ensures the advisor isn’t just planning based on numbers, but based on your life. You can generally expect this part to take somewhere around 2-6 weeks, driven primarily by how long it takes you to forward information over to your advisor including any follow-up details they request.
🧠 Step 3: Analysis & Strategy Development
With your information in hand, the advisor moves into the strategy phase working behind the scenes to analyze your situation and design a personalized plan.
This is where technical expertise meets real-life relevance. Your advisor will evaluate:
Cash flow: Are you saving enough? Overspending? Missing opportunities?
Net worth: How are your assets and liabilities evolving over time?
Retirement readiness: Are you on track to retire when and how you want?
Investment strategy: Is your portfolio aligned with your goals and risk tolerance?
Tax planning: Are you minimizing unnecessary taxes now and in the future?
Insurance: Are you under- or over-insured, or missing key protections?
Estate and legacy planning: Do your documents match your intentions?
They’ll also test different “what-if” scenarios, model trade-offs, and explore strategies to get you closer to your goals of saving more efficiently, reducing tax drag, adjusting your asset allocation, rethinking timelines, or whatever else you’ve mentioned is important to you. Don’t let them do this entirely in isolation, though, if you’re interested in diving into those details and helping model everything. Some clients really like to see every part of every calculation, while others only care about getting the answers. Where you fit on that spectrum is your decision.
This stage typically takes around 2 weeks to complete, depending on the complexity of your situation and scope of services.
🧭 Step 4: Plan Delivery and Recommendations
Here’s the moment where it all comes together. Your advisor will present the plan, walk you through their recommendations, and explain why each piece matters.
Expect:
A clear summary of where you stand today
Retirement projections and scenario modeling
Investment, tax, and savings strategies
Suggestions for optimizing insurance and estate planning
A step-by-step action plan with priorities and timelines
This should be a conversation, not just a presentation. A good advisor will explain things clearly, welcome your input, and make adjustments if needed.
🛠️ Step 5: Implementation
Once the plan is finalized, it’s time to put it into action. Depending on your advisor’s model, implementation might mean:
Full-service support: Your advisor opens accounts for you, reallocates investments, completes the paperwork for insurance policies, and more.
Guided DIY: With advice-only planners, you’ll take the lead on executing the plan but with their support and guidance as needed.
Collaboration: Your advisor may work alongside your tax preparer, attorney, or other professionals to keep everything aligned.
✅ Be sure to clarify: Who’s responsible for doing what, and when?
🔁 Step 6: Ongoing Support (if applicable)
If you’ve signed on for an ongoing relationship, you’ll receive continued guidance and check-ins (typically on a quarterly, semiannual, or annual basis) along with support when life throws something new your way.
This might include:
Plan updates as your life and financial situation evolve
Portfolio monitoring or rebalancing (if applicable)
Proactive tax strategies
Budget check-ins and goal tracking
Help navigating big financial decisions or transitions
You’ll also likely get access to a secure client portal, visual dashboards, and easy scheduling tools to stay organized and on track.
What If You Only Want a One-Time Plan?
That’s increasingly common, and totally fine by some financial advisors. Many advisors (especially those who are advice-only or flat-fee) offer one-time plans with:
A written roadmap and summary of recommendations
30–90 days of post-plan email or phone support
The option to re-engage later if your situation changes
It’s a great way to get clarity and direction without a long-term commitment.
The entire planning process should leave you feeling more informed, more confident, and more in control of your future, not overwhelmed or pressured. You don’t need someone to take over your life, you need someone to walk beside you as a thoughtful guide.
Next, we’ll wrap up with a few lasting takeaways to help you move forward with clarity.
Final Thoughts: Advice You Can Trust
If there’s one thing to take away from this guide, it’s this:
You deserve financial advice that puts you first.
Not advice that leaves you confused, intimidated, or wondering what just happened.
Not advice that was just copied and pasted from a template with no regard for your own personal situation.
Not advice designed only to sell products.
Not advice that only makes sense if you have millions to invest.
The right advisor can help you make life-changing decisions with confidence. They can turn a scattered set of questions into a plan. They can calm your nerves when the market dips, help you weigh trade-offs when life throws a curveball, and offer thoughtful strategies when the stakes are high.
But finding that advisor takes more than a Google search.
It takes asking smart questions. Understanding how business models work. Knowing the difference between a fiduciary and a salesperson. And making sure the person sitting across from you (or on the other side of the Zoom screen) understands that you’re not just a balance sheet. You’re a human being with goals, values, and a story.
What to Do Next
If you’re ready to take the next step, here’s a quick checklist:
✅ Clarify what you want help with (goals, life stage, financial planning topics, decisions)
✅ Decide whether you want one-time or ongoing financial advice
✅ Use a trusted directory to start the search for qualified advisors
✅ Ask the right questions about fees, ethics, and process
✅ Don’t ignore your gut feeling about personality fit and communication
✅ Walk away from red flags, and keep looking if something feels off
There are thousands of experienced, skilled, ethical, financial advisors out there who want to help people like you. Most of us who get into this field do so because we genuinely care for the clients we serve and understand the impact that financial planning can have on transforming lives.
And if you decide that now’s not the right time to hire anyone? That’s okay too. This guide will be here when you’re ready.
You Are the Client. You Are in Control.
Financial advice should serve you. Not the other way around.
No matter your income, your net worth, or your past financial mistakes, you have the right to work with someone who listens, respects you, and gives you advice that’s competent, clear, and always in your best interest.
That’s what real financial planning looks like. And now, you know how to find it.