Evaluating Your Financial Advisor

Do you have a financial advisor? If so, how do you know if s/he is serving you well? As with any professional expertise you lack, it’s not easy to determine.

Here’s the framework I use when evaluating an advisor:

Investment Strategy Expertise

  1. Is there a systematic approach to determining the optimal asset allocation?
  2. Is it tax- and cost-efficient?
  3. Is it understandable?
  4. Do you receive performance comparisons to relevant benchmarks?


  1. Is the fee structure conflict-free?
  2. Are the fees transparent?
  3. Are the fees reasonable?


  1. Does the advisor act as a fiduciary?
  2. Is your advisor and her/his firm free of any history of disciplinary proceedings?
  3. Does the advisor have a Certified Financial Planner (CFP) designation?

Other Financial Planning Services

  1. Does the advisor have retirement, estate, tax, and college planning expertise?
  2. Does the advisor provide guidance for budgeting, financial projections, and other related topics such as Social Security timing, annuities, and Roth IRA conversions?

You want the answer to all these questions to be yes.

You’re entrusting your life savings so there is a lot to consider when assessing a financial advisor. Be sure you understand if your advisor provides value, offers the services you need, has an acceptable fee structure, and importantly, if you can trust your advisor to look out for your best interests.

Need help doing this evaluation? Get in touch to learn about my Financial Advisor Assessment service.

Previously, I explained what financial advisors do (here) and how to pay them (here).

PS:  I’m teaching a one-hour class on Evaluating and Compensating Your Financial Advisor on Saturday, October 17th. You can sign up here or learn about my other upcoming classes here.

Questions?  Get in touch

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