Community Futures Meridian

Box 2167, 125 - 1st Avenue East, Kindersley, SK - Phone: (306) 463-1850

How to Choose a Financial Advisor You Can Work With

  • September 6, 2016
  • Written by Meridian Admin

As a small business owner, you may enlist the services of a bookkeeper, or accountant, or you may handle the day-to-day bookkeeping yourself and only get professional help when it comes to tax time. Whatever your approach to your company’s financial accounting it might still be worth considering retaining the services of a financial advisor.

Why? Because running a business is a head down activity; you are so busy selling, marketing, producing, managing and fighting fires it’s easy to lose sight of the bigger picture. That’s where a financial advisor can help big time. They don’t just help with investments and insurance, they can also be an important ally in your business and help you come up with a long-term financial plan that makes sense for you and your company.

Okay, you’re convinced, you’ve decided to use a financial advisor, how do you choose the right person for the job? Here are seven questions you should ask a potential financial advisor.

1. Credentials - What professional certifications, designations and degrees does he/she hold? Professional designations tell you the advisor has undergone rigorous training to achieve their professional status. Your accountant may not have these financial planning certifications and therefore may not necessarily be a good financial advisor. Look for the following designations:

a. CFP – Certified Financial Planner

b. CFA – Chartered Financial Analyst

c. PFP – Personal Financial Planner

d. FCSI – Fellow, Canadian Securities Institute

e. CSC (Canadian Securities Course)

f. IFIC – Investment Funds in Canada – note this is deemed to be a beginner course and easy to obtain

2. Experience – How many years’ experience does the advisor have? Ensure the candidate has a good track record of helping small business owners build and protect their wealth.

3. Payment – Ask the financial advisor how he or she gets paid. It’s generally better to stay away from advisors who collect brokerage commissions and work with one that is paid on a fee for service basis. Advisors who stand to gain from what they sell you, may sell you something in their best interests, not yours.

4. Chemistry – What’s your gut feeling about this person? Do you trust them? Do you feel good about working with them? If you have even the slightest hesitation, or if you see any red flags during your interview, move on. Ask yourself whether this is someone you can see yourself working with for several years to pursue your financial goals.

5. Attitude – Do you sense the advisor is genuinely concerned about the success of your business? Look for someone who asks questions about your business and is interested in what you are trying to achieve. You don’t want an advisor that offers cookie cutter advice – it has to be specific to your circumstances.

6. References – Never choose someone to work with without checking their references. Always ask for, and follow up on, references. Contact people who have worked with them. Ask questions such as:

a. How well does he/she work with your accountant or your lawyer?

b. Do you see yourself being with this person for the long haul (why or why not)?

c. What has this person been able to achieve for you?

d. Have you ever had any concerns about this person’s conduct and/or advice?”

Remember, your financial goals are at stake, so do your homework.

7. Results – Finally, ask what they are specifically prepared to do for you and how they will keep you informed. Quarterly assessments? Monthly meetings? Annual statements? Make sure they are willing to work with a system that is comfortable and useful for you.

A financial advisor can be a great asset to your business, but only if you get the right one, so ask around for recommendations, especially from successful people you know. Think about bringing a financial advisor on board as just one more way to add expertise to your business.