Steps in Choosing a Financial Advisor in a Secure and Safe Way

Have you ever heard in the media that financial advisors are being accused of bilking their clients out of millions and millions of dollars? Are you afraid the same may happen to you as well? If you are looking for a financial advisor you can trust, you have come to the right place. In this article, we will educate you on protecting yourself by hiring a reliable financial advisor. Follow the next steps to be better protected from the likes of ill intent financial advisors.

How Can You Protect Yourself?

When looking for a financial advisor, talk with your friends, relatives, and coworkers first. If they have a trusted advisor, allow them to recommend you someone who knows how to do his job. Referrals always were and still are the best and most reliable way to find quality services and highly trained professionals. Once you get a name, go to, the public’s watchdog organization for financial advisors and brokerage companies. FINRA is the acronym for Financial Industry Regulatory Authority, and it was created ten years ago with the consolidation of the NASD and the enforcement and arbitration divisions of the New York Stock Exchange. On their website, look at the investor’s section and click on the FINRA broker check tab. This feature will allow you to test the advisor you are considering to hire and check the brokerage firm your potential advisor is affiliated with. All problems or complaints from this consultant or company will be listed there. Don’t forget to do this even if your friend has referred the advisor to you. It’s better to be safe than sorry.

Once you are satisfied with what you have read on the FINRA site, you should set up a meeting. It is very important to talk in person with someone who will potentially handle your life savings. You should feel comfortable and relaxed with this person. Although that may seem unimportant, have in mind that you are going to be working with that particular person for many years. You will find hard to trust that person if you don’t feel comfortable enough.

Ask for References

Before hiring your new advisor, ask for at least two references of former satisfied clients. The advisor will certainly give you names of the people he knows well and gets along with, but the point of your question is to see the advisor’s reaction. He or she shouldn’t try to disclose that kind of information. If you get the response that sharing this information is against the policy of the brokerage firm, we advise you to continue searching for your investment professional. Never forget that the financial advisors, as well as the brokerage firm you are about to hire, should fit your needs, not theirs. The last step of choosing your financial advisor in a safe and secure way is to go back to step one and repeat everything we said. Although this may be a time-consuming process, it will be worth it. This is very important – you shouldn’t make a final decision before you look at a minimum of three financial advisors.

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