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Plan Well, Retire Well

Saving and investing your money
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How to Choose a Financial Professional


We can't be an expert in all topics. That's why we seek help from people who have expertise in areas we don't. Financial professionals can help you explore alternatives and strategies to best manage your finances.

People seek help from financial professionals for a variety of reasons, and you likely will have different reasons over your lifetime.
  • You might not have the expertise you need to do the task; many people use tax accountants to help file their taxes.
  • A change in a person's life (such as approaching retirement age) can trigger a need to use a financial professional as well.
  • And, some people use financial planners because they are too busy to effectively manage their finances.

However, choosing a financial professional is a scary proposition for many people. It can be hard to decide who you want to trust with your money and your future dreams. You can find a financial professional who is qualified by taking time to ask questions. Before deciding who to work with interview two to three people.

Unfortunately, government regulations do not protect the consumer very well in this area. Anyone can call themselves a financial advisor. University of Illinois Extension's website, Choosing a Financial Professional, has an interview guide you can download for free. Interviewing financial professionals allows you to find a good match for you.

While you're talking to the financial professionals, ask about:

  • their experience and education (including required continuing education),
  • how they will be paid,
  • and whether or not they will have a fiduciary relationship with you.

Think about what services you need. Then, identify a financial professional who has experience and education that matches your need. For example, if you are 28 years old and are looking for investment advice, then you may not want to choose someone who specializes in estate planning for 70 year olds. Or, if you need advice about filing taxes for your small business, then you need someone with tax expertise.

Never hesitate to ask how a financial professional will be paid. Typically, financial professionals charge by fee only (dependent on the project or hours worked), by commission (determined by products or investments sold), or a combination of fee and commission. You have the right to know how much financial services will cost and how they will be calculated.

A person who has a fiduciary relationship with you must offer the best choices to you; other financial professionals must offer suitable choices. There are good reasons to work with either type of financial professional but you want to know where they stand on this issue.

At Choosing a Financial Professional website, you'll find links to several online searches that connect to financial professionals in your community. You may also want to ask friends or other acquaintances for suggestions of financial professionals.

Keep in mind that even if someone is the perfect match for your Aunt Fran, it doesn't mean that they are the right financial professional for you. Be sure you're comfortable asking questions and talking to the financial professional. You want someone who can explain things in a way that makes sense to you.

One last, but important, step: once you narrow your choices, check the financial professional's background and references. First, check online at FINRA's BrokerCheck, . Next, check a person's licenses and disciplinary records by calling the Illinois Securities Department, toll-free 1-800-628-7937. If someone is helping you buy or sell investments, you must be sure that they are licensed to do so in Illinois. A recent webinar, Choosing a Financial Professional, is archived and you can listen to it for free.

We all accept the time it takes to shop around for a new car. Take the time needed to shop and compare when you choose a financial professional.



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