5 Key Questions To Ask Your Financial Advisor

3. What licenses do you possess?

When you pop the question about your advisor’s licenses, you’re really checking out two important things. First off, it tells you if they’re wearing the hat of a broker, insurance agent, or investment advisor – which gives you a heads-up on the kind of advice they’re likely to dish out and how they make their money (which could affect their recommendations). Brokers and insurance agents might call themselves advisors, but they often earn their keep from product commissions, so their advice might just be suitable, not always in your best interest. To steer clear of any conflicts, aim for a licensed investment advisor who’s solely focused on looking out for your best interests. Look for someone tagged as an Investment Advisor Representative (IAR) at a Registered Investment Advisor firm. These folks are fiduciaries by default and work on a fee-only basis – meaning they’re on your team and their paycheck comes directly from the fees you pay. It’s all about finding someone who’s truly in your corner!