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Questions to Ask Your Financial Advisor

August 23, 2016

Many that have a financial advisor or investment manager get periodic updates and reasonably unlimited phone calls. However, I notice that many do not. Here are some questions to consider asking to determine how your money is being handled. If you know the answers to all of these questions, then good for you – it seems you are in good hands. Otherwise, ask these questions.

  1. How often should I expect communications from you regarding my portfolio, its performance, and strategy or any changes in strategy?
  2. Why don’t you ever call me when there is a major drop in the stock market?
  3. How does the present portfolio match up with the original plan or instructions that were discussed when you started managing my investments?
  4. Why has there been no co-ordination by you or attempt to find out about my other investment portfolios?
  5. What arrangements do I need to make with you now for my spouse if I die unexpectedly or become disabled?
  6. Why should I recommend you and to whom?
  7. Who decides what to buy in my portfolio, e.g. foreign vs. domestic or large and small cap, and how does the decision process work?
  8. What is your fixed income strategy – the yield appears very low after deducting your fees?
  9. It seems the fees I am charged are different than what we agreed to – can you explain your charges?
  10. Why is there always a balance in my cash account and how come some of the purchases in my account are for very low amounts, and how often do you make purchases?

It’s your money; it might be your future financial security and missteps might alter the plans you made for the rest of your life. Be a little involved. Ask these and any other questions that are on your mind.

When you get the responses, evaluate them to determine if this advisor is still the right person for you.

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