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Questions to Ask a Financial Advisor About Retirement


Planning for retirement can be overwhelming, because it involves figuring out a plan for your money that is supposed to have last you for a long period of time, and often involves sorting things out now for a point time that could be relatively far in the future. Seeking the services of a professional financial advisor may be able to set your mind at ease a little bit, but before locking in any particular financial advisor services, you need to prepare research and a list of questions so that you can understand if they are someone you would potentially like to work with to help set you up for retirement.

Questions About Their Qualifications

The first set of questions you should consider asking your financial advisor before you even begin in these discussions about retirement it is a set of questions regarding the advisors qualifications. These questions may include:

Questions About Their Business

Image shows the hands of two people who are sitting across from each other at a desk. Between them sit various financial documents that they are reviewing together. Research and communication is important when preparing to speak to a potential financial advisor.

Questions about the financial advisor’s business will help you understand the way that he approaches his day-to-day administrative responsibilities and the way that he communicates with their clients. Some questions include:

  • What types of clients do you work with? Is there a minimum investment amount? This will give you a sense of who the advisor’s regular clientele includes and whether their current client base and minimum investment is a clientele that you might potentially be part of. Some financial advisors only work with high-net-worth clients or ultra-high-net-worth clients, for example. If you don’t have enough to meet this kind of a minimum investment, it may be necessary to seek out the services of another advisor or firm.
  • What services do you provide to your clients? How do you communicate with them? Communication with clients is key, and different clients require various levels of updates and reports. However, a relatively regular schedule of communication is ideal so that you understand what is happening with your financial plan and can have a way to connect in case something changes on either end.
  • How does your fee schedule work? What are potential extra costs? Fee schedules are often based on a percentage of assets under management (AUM). There are also wrap fee programs and fee-only vs. fee-based distinctions to understand about every financial advisor firm. Performance-based fees may also come into play. It’s important to understand all of these up front so that you avoid any unnecessary fees as early as possible in your relationship with a financial advisor.

Questions About Your Money

When it comes to asking specific questions about your money, specific answers may not be most accurately available until you actually start working with a financial advisor. However, asking potential advisors some of these kinds of questions up front can help you understand how they think about working with client assets and the ways that they view retirement planning. It’s important to understand if a financial advisor will be able to tailor their specific services to fit both your long-term retirement plans and any of the shorter-term, sometimes unexpected situations that you and your money may face over the course of time.

  • What is your investment philosophy? Analyses will vary from advisor to advisor, but may include fundamental analysis, technical analysis and more. Strategies for your money will depend on your goals, so be sure to note whether what the advisor is saying aligns with what you need.
  • Do you or your firm have any disclosures? Investment advisors who are registered with the Securities and Exchange Commission (SEC) are required to report disclosures in annual filings of Form ADV. This information can be found on the SEC website, but it’s important that a potential advisor or firm be able to explain any further questions you may have about their record.
  • How will you ensure the security of my financial plan if you’re no longer my advisor? A backup plan of some kind is always important in case an advisor moves firms or transitions in their career.
  • Based on my needs and wants, how much money will I need to retire? What factors can you help me plan for? Again, amounts will vary from client to client, and not all exact figures will be available to even estimate until an advisor has all of your information in hand. Still, some important considerations to keep in mind are healthcare, tax consequences, investments, social security, pensions and annuities, to name a few. How skilled is your potential advisor in handling these topics? Does she have a team she can work with or recommend if she is less experienced?
  • How can I boost retirement income and reduce retirement expenses? How should I prioritize my finances pre-retirement in order to make the most of them later? Do this advisor’s answers align with your current financial growth goals and outlooks, as well as your long-term ones?

Bottom Line

Image shows a variety of financial planning documents, including a financial report and a 401(k) report, all potential information necessary for an interview with a potential financial advisor.

Retirement planning doesn’t have to be as labor-intensive as another job, especially if you can find the right people to support you. Hiring a financial advisor might be a good step to take. Make sure you understand how to begin your research by preparing a list of questions that value the needs and wants that are important for you and your loved ones to have as you approach retirement. Some of the types of questions to note are questions about the advisor’s qualifications and business, as well as questions about how they will approach handling your hard-earned money.

Tips for Deciding Whether You Need a Financial Advisor

  • You have a list of questions, but how do you actually get connected to an advisor? Finding a qualified financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with up to three financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
  • Don’t forget get to ask yourself some questions, too. Financial advisors have different areas of expertise, so it’s important to consider why you want an advisor before diving into the search. If you’re looking for helping crafting a financial plan, a certified financial planner (CFP) may be useful. If you’re going through a divorce, you might want the assistance of a certified divorce financial analyst (CDFA).

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