Finding A Financial Advisor

Many of us could use a hand in managing our money. Financial advisors can provide valuable guidance, helping give you confidence and direction to navigate financial decisions. But did you know that there are several types of financial advisors? Here we’ll discuss the kinds of advisors you may need, the services they offer, and what sort of skills and attributes to look out for as you find a financial advisor.

When it’s time to find a financial advisor

It’s never too early to work with a financial advisor. Young people starting their careers, even with uncomplicated finances, benefit from an advisor’s guidance on building sound saving and investing habits.

Once your family situation and financial goals grow, with the addition of other expenses like a house, spouse, children, or care for aging parents, the need to find a financial advisor becomes even greater. A seasoned professional can help you navigate investing for your children’s future, establishing long-term care for your elders, managing real estate and the nuances of financial planning with a spouse.

A good financial advisor will assess your current situation and explain the specific steps you may need to reach your goals. You may need to learn the basics about savings and budgeting, or something more complicated, like long-term investment and tax strategies.

How to choose a financial advisor

“Financial advisor” isn’t a regulated title in terms of job professions. There are many types of financial advisors, and it’s important to find one that will best serve you as you manage your money. Here are some tips for finding a financial advisor who’s right for you.

Look for a fiduciary

The very first question you should ask when interviewing financial advisors is if they have a fiduciary duty. A fiduciary is someone who is required to act in your best interest, even if it means that they’ll make less money off of the services they provide to you. Not all financial advisors are required to meet a fiduciary standard, so it’s an extremely important factor when finding a financial advisor.

It’s also important to note that not all fiduciaries may take their responsibilities seriously. If you’ve found someone who needs to meet this requirement, check their reputation with others who know them. You can also check what others say about them on Google Reviews.

Assess the financial advisor’s credentials

While all advisors are there to help you manage your money, different advisors have different specialties and priorities. Here are a few that you may encounter:

• CFP® or Certified Financial Planners: They go through rigorous education and certification. You’ll probably see people with this certification call themselves financial planners, financial advisors, or wealth managers. These advisors help you manage your money holistically. They can help you with everything from investing to life insurance to retirement planning.
• CFA® or Chartered Financial Analysts: They are easy to mix up with CFPs. But as their name suggests, CFAs focus more on analytics. They usually work with people with enormous investment portfolios or with large companies.
• CPA or Certified Public Accountants: They focus on tax preparation. They can help with either your short- or long-term tax planning strategies, and may work in collaboration with other financial advisors like CFPs.
• IAR or Investment Advisor Representatives: They work for registered investment advisors and are registered with the Securities and Exchange Commission or with state regulators. These representatives focus on investment portfolios by default, but some may offer a broader range of services. They are also required to act as fiduciaries.

You can check your advisor’s credentials with FINRA. Doing a broker check in this manner will also show the advisor’s work history, licenses and if they have any complaints or regulatory actions taken against them.

Ask financial advisors about their fee structure

All financial advisors get paid, but how they get paid can have a big impact on your own financial outcomes. There are three general classes of fee structures:

• Fee-only financial advisors. Fees may be charged. They may charge either an hourly rate or a per-service flat fee. Otherwise, some fee-only advisors base their fees on a percentage of your assets under management (AUM).
• Commission-based financial advisors. They receive a commission for each sale of specific financial products, be it life insurance or investment products. Financial advisors paid purely on commission typically forgo fiduciary responsibility.
• Fee-based financial advisors. These financial advisors operate under a mixed pay structure. They may charge a fee based on your AUM, and they may also earn commissions when their clients use certain financial products.

How to evaluate a financial advisor

When searching for a trustworthy financial advisor, be sure to interview several candidates. You can also ask your network about who they work with, as those personal testimonials can go a long way to establishing credibility. Ultimately, you want to find someone who you trust with the numbers, but also with their ability to communicate and educate in a way that best suits your learning style.

Here’s a recap of important questions to ask beyond just “liking” the person:

Finding a financial advisor you can trust

Mutual of Omaha’s network of advisors provides a wide range of financial planning advice. The advisors are here to get to know you and help you navigate the world of finances. When they don’t have answers right away, they have other people they can call on who have the training and certifications necessary to help you make the best decisions for you.

If you’d like to learn more about the capabilities of our financial network, reach out and one of our financial professionals will contact you.

Frequently Asked Questions

Q1: How do I go about finding a financial advisor near me?

To find a financial advisor near you, ask your local network who they use, or go to the website of the appropriate certifying board to do a local search.

Location is more important for some professions than others. For example, CPAs deal with complicated state tax laws. When dealing with a CFP®, though, it may be more important to have someone who specializes in your particular type of financial goal rather than someone who works in a specific state.

Q2: What’s the difference between a financial planner vs an advisor?

Many times, the terms “financial planner” and “financial advisor” are used interchangeably. A financial planner is more likely to have a CFP® certification, while a “financial advisor” is usually used as a catchall term that can include many certifications, like CFP® or CFA®.

Q3: How much will it cost to see a financial advisor?

The cost of meeting a financial advisor can vary wildly depending on the advisor’s fee structure and the size of your portfolio. Often–though not always–the first meeting or two you have with a financial advisor will be free for the initial consultation. The charges don’t kick in until you engage with them for actual asset management or the purchase of specific financial products.

Disclosures:

Registered Representatives offer securities through Mutual of Omaha Investor Services, Inc., Member FINRA/SIPC. Investment Advisor Representatives offer advisory services through Mutual of Omaha Investor Services, Inc.  Mutual of Omaha Advisors is a division of Mutual of Omaha Insurance Company.

All investing involves risk, including the possible loss of principal, and there can be no assurance that any investment strategy will be successful.

Real estate investing can be subject to a number of risks, including but not limited to general market risk, liquidity risk, credit risk, structural risk, and leverage risks.  The strategies mentioned may not be suitable for everyone.

Mutual of Omaha and its representatives do not provide tax and/or legal advice, and the information provided herein is general in nature and should not be considered tax and/or legal advice.

Not all Mutual of Omaha agents are registered representatives or financial advisors.

451721_0525