Financial planner: 6 Questions you may ask and tips to spot a trouble

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By: Good Nelly
on 28th Apr,2015

Financial planners show you the correct road to a happy financial life.
Financial planner: 6 Questions you may ask and tips to spot a trouble


Financial planners show you the correct road to a happy financial life. They suggest you the tips and strategies to repair your damaged financial health efficiently. The planners also help you cure your financial diseases and restore your health.

Usually, people don't hesitate to bombard nurses and doctors with all the questions in their minds. But it has been observed that some people avoid asking tough questions to the financial questions. It may be the case that people feel uncomfortable about discussing about money. But this should not be the case. You should ask several questions to the financial planners before working with them. This will help you know whether or not the planner has sufficient knowledge and expertise to bail you out of your financial problems. Read on to know about 4 essential questions you must ask to a financial planner. 

Questions you should ask your financial planner

Check out the 4 essential questions you should never forget to ask a financial planner:

Q1. What is your educational qualification?

A. Any one can claim himself to be a financial planner. But does he have the requisite qualification to be regarded as a financial planner? You should ask the planner about his educational qualification at the very first meeting. This will help you know whether he is qualified enough to give financial tips and suggestions to the people. Check whether or not he is recognized as a Certified Public Accountant or a Certified Financial Planner.

Q2. For how many years are you working in the industry?

A. You should ask the planner as to whether he has provided financial counseling to the people in the past. Ask about his total work experience in the industry. It is better to work with a planner who has good knowledge and experience in various financial fields such as investments, debt, tax, retirement planning, mortgage, credit, etc. Select a financial planner who has minimum 5 years experience in the industry.  

Q3. What kind of services do you actually offer?

A. Ask the financial planner about the type of services he offers to his clients. But don't expect him to offer financial products such as bonds and mutual funds to you. The financial planners are not allowed to do that. 

Q4. Will I be working with you directly?

A. You should know whether or not the financial planner will be only working with you. If the planner has several clients and can't work with you directly, then ask him about the persons who will assist you. You can do a background check of those persons as well. 
 
Q5. What is your remuneration?

A. Some people shy away from asking this particular question. It is not an embarrassing question at all. After all, you need to know how much you'll have to pay for services of the financial planner. The answer to this question will help you know whether you can afford him. You must also ask the planner about the mode of payment. Usually financial planners are paid in 4 different ways - (a) fees, (b) salary, (c) commission, (d) fees and commissions. 

Q6. Can you give some details about your client portfolio? 

A. If you are in your fifties and are looking for advice on retirement planning, then a financial planner mainly dealing with corporate clients may not be helpful for you. So, it is better to know about the type of clients for whom he usually works for.   

2 Tips to recognize a bad financial planner

Here are the 2 tips that may help you spot and avoid working with a bad financial planner:

1. Dig information: Research on the financial planner before deciding to work with him. You can ask his existing and past clients as to whether they are satisfied with his service. Have they at all financially benefited by working with the planner? Make sure you ask this question to the clients of the financial planner. You can also browse online to get information on the financial planner. If you find too many complaints have been made against the planner in the popular financial forums and social networking sites, then it is better to not work with him.

2. Look at his criminal record: Find out if any lawsuit has been filed against the financial planner in the past. Check whether or not the planner has been penalized due to some fraudulent or unethical activities in the past. You can even check his background with some reliable financial organizations such as FINRA and CFP Board.


Finally, you should ask the financial planner to draw up a contract where details of the services will be laid out. Make sure you read the contract time and again before signing it.

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