Top Questions to Ask an Advisor

IN THIS ARTICLE

• Fees, Fiduciary Duty, and Credentials
• Investment Approach and Client Fit
• Service, Communication, and Continuity
• What should I Bring to our First Meeting?
• Red Flags to Watch For
• Why Does Asking These Questions Matter?

Choosing a financial advisor is a big step — and asking the right questions can make all the difference. You want someone who understands your goals, communicates clearly, and genuinely has your best interests at heart.

The questions below can help you find that advisor.

Fees, Fiduciary Duty, and Credentials

How do you charge for your services?

Advisors can be fee-only, commission-based, or a mix of both, and you know exactly how they charge before you commit. Fee-only advisors charge a flat fee, hourly rate, or percentage of assets they manage for you. Commission-based advisors earn money when you buy specific products. Some advisors use a combination of both approaches. Ask whether they receive compensation from any products they recommend, because how they're paid can influence the advice they give you.

Do you always act as a fiduciary?

Why it's important to ask: A fiduciary is legally required to act in your best interest at all times, while an advisor held only to a suitability standard must recommend products that are merely suitable for your situation. The distinction matters.

In 2020, the SEC's Regulation Best Interest (Reg BI) took effect, raising the standard for brokers from suitability to a best interest obligation for retail clients. However, Reg BI applies specifically to broker-dealers, not all financial professionals. Because a fiduciary standard is broader and applies in more situations, it is worth asking directly whether your advisor operates as a fiduciary at all times.

What are your credentials, and how long have you been practicing?

Why it's important to ask: If your advisor has professional designations like the CFP® (Certified Public Accountant) certification or CFA® (Chartered Financial Analyst), it shows they've completed rigorous training and exams. You can verify their licenses and certifications through regulatory databases.

When you ask about how long they've been practicing, it can shed light on their experience and if they bring the perspective that newer advisors may still be building.

Investment Approach and Client Fit

Do you work with clients like me?

Why it's important to ask: You need to know if an advisor specializes in your situation because it they can offer more relevant guidance than one who works with everyone. Whether you are a business owner, nearing retirement, or just starting out, you want someone who understands your world.

You can also ask which services they provide, such as investment management, retirement planning, tax planning, or estate planning, and whether those offerings match what you need.

What's your investment philosophy, and how do you manage risk?

Why it's important to ask: Every advisor has a philosophy that shapes how they choose investments and manage your portfolio. Some lean toward active management, while others prefer a passive approach. Some incorporate Environmental, Social, and Governance (ESG) factors into their decisions.

When you ask how they select investments, you're trying to determine whether their approach aligns with yours, and how they manage risk through diversification and rebalancing.

Service, Communication, and Continuity

How often will we meet, and will I work with you or your team?

Why it's important to ask: Regular check-ins keep your plan on track, so ask how often you will meet and whether those meetings will happen in person, virtually, or by phone.

You can also ask whether you will work directly with the advisor or with a team. It is good to know who will be in your corner and how they support clients during market downturns.

How do you measure success, and what will I receive in reports?

Why it's important to ask: Success means different things to different people, so asking how your advisor defines and tracks it to make sure you're both on the same page. Some focus on progress toward your goals rather than just market performance.

You can also ask what reports and updates you will receive and how often, so you always know where you stand.

Can you share your regulatory history, and where can I review your record?

Why it's important to ask: A clean regulatory record is a positive sign, and you have the right to verify it, so you're doing your due diligence when you ask whether they have ever been disciplined or had disputes.

You can review their regulatory record through FINRA BrokerCheck or the SEC's Investment Adviser Public Disclosure database.

What's your plan for my account if you're no longer available?

Why it's important to ask: A good advisor has a plan for what happens to your relationship if they retire, become ill, or leave the business.

When you ask who will take over your accounts and how the transition would work it shows you're thinking long term. Receiving a thoughtful answer from the advisor shows they are, too.

What should I bring to our first meeting?

Before your first meeting, gather relevant financial documents and formulate questions to make the most of your time. This preparation helps you receive tailored advice that addresses your financial needs and goals.

Don't forget to bring items like:

• Income statements
• Investment account statements
• Debt information 
• Insurance policies
• Estate planning documents
• Notes on recent or upcoming life events
• Your investment preferences and goals
• Your questions, because you are interviewing them just as much as they are advising you

Red Flags to Watch For

There are a few surefire indicators that an advisor may not be right for you. Keep your eyes open for these warning signs:

• Vague answers to direct questions.
• Hidden fees or complicated fee structures can eat into your returns. Transparency is non-negotiable.
• If an advisor is reluctant to share credentials or fee information period.

If you experience any of these during your meeting, it may be time to walk away.

Why does asking these questions matter?

Asking questions helps you make sure your advisor's approach, fees, and philosophy line up with what you are looking for. It is also a great way to build trust and make sure you are both in alignment. Ask why they became an advisor and how they align their advice with your values and lifestyle. The right advisor welcomes these questions, because a strong relationship starts with open communication.

If you do not have an advisor yet, the LPL's Find an Advisor tool can help you connect with professionals who match your needs.