Selecting the right professional is a critical first step on the road to financial independence.
A financial security advisor is a trusted professional who can help guide you through many of life’s most important financial decisions. Few investments are as important as the time you spend selecting the right advisor.
Financial security advisors may specialize in certain areas but they must be able to see the big picture. Their expertise should touch on all key areas, including investment, insurance and estate planning, and tax-effective strategies. They should know your financial situation down to the fine details, including your goals and aspirations, making them an invaluable resource.
Why it’s important to ask around
A great way to find candidates is to ask for referrals from people you trust who have a similar financial profile. This could include colleagues, accountants and lawyers. You should come up with the names of three people before starting to meet potential candidates.
Always meet your prospective financial security advisor in person and take the time to ask many questions. Don’t forget to tell your story in detail.
Being clear about your goals
Before the interviews, develop a clear set of objectives and needs. Most financial security advisors have expertise in a specific area, such as retirement planning or life insurance planning. If mutual fund investment advice is central, ensure the financial security advisor is also an investment representative registered and in good standing with the Mutual Fund Dealers Association (MFDA) and the Autorité des marchés financiers (AMF) in Quebec.
Create a basic framework covering what you want your financial security plan to help you accomplish. Think far ahead, whether it’s buying a house, having kids, purchasing a vacation property, planning a trip around the world, or exploring retirement. Bring a detailed list of assets, investments, sources of income and outstanding debts and potential liabilities and roadblocks.
Topics to explore
Make the most of the interview by preparing a list of key topics:
- Qualifications, accreditation and experience
- Services offered
- Fees and how they are paid
- Potential conflicts of interest from recommending certain investment products
- How often you meet for updates
- An exit strategy if it doesn’t work out
It’s always a good idea to request the details of your financial security plan in writing in case you wish to refer to them later. Remember, you’ll trust this person with sensitive information about your financial dreams. Be very clear about your risk tolerance.
What about me?
The interview is also the best time for a financial security advisor to learn about you. You should be candidly answering some probing and pointed questions. This is also the perfect opportunity for you to ask the prospective financial security advisor for views on your financial situation.
Make sure to meet everyone who’ll be working with you. Keep in mind that, while you certainly want to “click” with the financial security advisor’s team, prudent financial counsel may, at times, require a firm touch. Look for an authoritative, concise communicator who isn’t afraid to speak freely and is keen to ensure you understand every concept discussed.
The interview and vetting process may be time-consuming, but the right financial security advisor plays an instrumental role in helping you achieve your life’s goals – including financial independence.
The information provided is based on current laws, regulations and other rules applicable to Canadian residents. It is accurate to the best of our knowledge as of the date of publication. Rules and their interpretation may change, affecting the accuracy of the information. The information provided is general in nature, and should not be relied upon as a substitute for advice in any specific situation. For specific situations, advice should be obtained from the appropriate legal, accounting, tax or other professional advisors.