Course 509: Seeking Financial Advice
Ask the Right Questions
In this course
1 Introduction
2 Decide What You Want.
3 Ask the Right Questions
4 Investigate Investment Philosophy
5 Calculate the Cost
6 Ask for References

Bring to that first meeting a checklist of questions, concerns, or issues you want addressed. Ask for and scrutinize a copy of the advisor's resume, known as the ADV form, available on the Securities and Exchange Commission's website http://www.adviserinfo.sec.gov/(S(qj14ek1nj3rfbnwqf3gaueen))/IAPD/Content/IapdMain/iapd_SiteMap.aspx. ADV forms include advisors' educational backgrounds and list which professional designations they hold, as well as information about the firm's typical clients and its overall assets under management. You'll also be able to see how the advisor is compensated.

If you're turning to a commission-based broker for financial help, you'll need to follow a different due-diligence process. FINRA regulates brokers, and its website provides a tool to check up on a broker's credentials as well as whether they've had any disputes with customers or run afoul of any regulations. Bear in mind, however, that brokers aren't always held to the same standards that financial advisors are. Financial advisors are required to be fiduciaries, meaning that they must recommend what they believe to be the best products for their clients and set aside personal financial considerations when doing so. Brokers, meanwhile, are held to what's called a "suitability standard," meaning that the products they recommend must be suitable for their clients but not necessarily the very best options. (The Securities and Exchange Commission is currently reviewing a proposal that would require anyone proffering financial guidance to be a fiduciary.)

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