Episode #12: Seven Questions to Ask Before Hiring a Financial Advisor

In this episode of the Retirement IQ, host John Stregger breaks down one of the most important steps in retirement planning: finding and evaluating the right financial advisor. While many people know they might need a second set of eyes on their financial situation, John explains that knowing exactly how to interview and select an advisor is crucial for building a successful, long-term partnership.

The episode then explores seven vital questions to ask a potential advisor: identifying your advisor's typical client and investment philosophy, understanding exactly how they get paid, exploring what services they offer beyond basic investment planning, and verifying their credentials and how they protect your assets.

Join us as we explore how to confidently prepare for one of life's most important professional relationships.

Transcript

Introduction

Hi everyone, and welcome to another episode of Retirement IQ, where I help you, our listener, simplify the complex world of retirement planning so that you can focus on building the retirement lifestyle that you want to have. I'm your host, John Stregger, and thank you for joining me.

Now, maybe you've been listening all along or maybe it's your first listen. But because you're tuning in, I gotta believe that you're here because you care about your financial future. If that's true, then at some point, you might also think to yourself that maybe I should get another set of eyes to look at my financial situation to make sure I'm not missing anything. In other words, you're thinking of engaging or hiring an advisor to get a second opinion. So, where do you start?

Finding the Right Advisor

Now, fundamentally, there are two ways to find an advisor. The first way is to search on the internet or listen to a podcast and see who might resonate with you. The second way is to ask your friends or family if they have an advisor and get a referral from them. Either approach can work. It's just gonna come down to who you find and if that person resonates with you.

So, what do you do when you do reach out to that person? I think it's important to have a set of questions that are going to help you understand if that person can really help you or not. A good advisor is gonna want to have a good conversation and the following seven questions can really set the tone for not only a great first meeting, but also a great relationship for you and that advisor. Think of this first meeting as the beginning of what could be a decades-long partnership. You're interviewing that person for one of the most important positions in your life. The person who will help guide your family's financial future. Good advisors are going to welcome great questions because they know that understanding builds trust. And trust is the foundation for everything that follows.

7 Questions to Evaluate an Advisor

So let's jump in with seven questions that you can use to evaluate an advisor.

• Question number 1: Who is your typical client? Now you want someone who specializes in people like you. Whether you're a teacher approaching retirement, a small business owner building wealth, or someone who just inherited money. Ask them to walk you through how they work with someone in your situation. They should be able to show you real examples of how they've helped similar clients navigate similar challenges to yours. You want someone that's got experience in the challenges you're gonna face in the future.
• Question number 2: What is your investment philosophy? Your investments are a major component of your financial plan and an investment philosophy is a compass that guides you through turbulent times. If an advisor promises to eliminate risk or consistently beat the market, that's a big red flag. Markets work precisely because uncertainty exists. Without uncertainty, there would be no opportunity for returns above what you get from a simple savings account or a GIC. The kind of advisor you want to work with might say, hey, I can't predict the future, but I can help you prepare for it.
• Question number 3: How do you get paid and what do you get paid for? These two questions go hand in hand. You want an advisor who puts your interests ahead of their own. Now when someone's compensation depends on how often they can get you to trade or buy a product they can sell you, your interests and theirs may not be aligned. Good advisors use different compensation models. Some may charge a percentage of assets they manage on your behalf, others use flat fees or hourly rates. What matters is alignment and transparency. You want a clear explanation of all fees. Not just the advisor's management fee, but every underlying cost including fund expenses, trading costs, and even custodian fees. Ask when fees change and whether financial planning is included or if it's an extra. The best advisors explain every cost and why their model serves clients like you.
• Question 4: How do you help beyond investment planning? Some advisors focus only on investments, while others offer comprehensive planning. You might want to ask if they provide retirement planning, tax planning, estate planning, insurance analysis, and even business succession planning. Many advisors can coordinate with accountants, estate planners, as well as insurance specialists to help put together the comprehensive financial plan that you might be looking for.
• Question number 5: How will we communicate? Now, you're also going to want to know how often you're going to meet with your advisor and how. Do they offer virtual meetings, in-person meetings, both? Who else might be on their team that you might work with as well? It's important to find an advisor who wants to meet with you on a regular basis so that there's never a communication breakdown between the two of you.
• Question number 6: How are my assets protected? Now your money should be held by an independent custodian that is separate from your advisor. Your advisor directs your investments according to your plan, but should never actually hold your money within their firm. If they tell you that they invest money directly into investments that they manage, that could be another red flag that you should learn more about. You want to find an advisor that is compliant with industry regulations and that means there should always be a barrier between your money and your advisor.
• Finally, question number 7: What are their credentials? There are several designations out there, but in my opinion, the pinnacle of financial planning designations is the Certified Financial Planner designation. Also known as the CFP. Not only do advisors that hold the CFP have to complete a series of rigorous financial planning courses to earn the CFP, but they also need to complete annual education requirements to ensure that they stay current with ever-evolving tax and estate planning changes.

Building the Relationship

Now during your first meeting, an advisor may spend more time listening than talking. Not only are you interviewing them, but they are also interviewing you. They might ask, what are your goals? What keeps you up at night? What does winning look like for you? And why are you looking for an advisor? They want to know about your family, your values, your dreams. Because investing connects to what your money can do for the people and causes you care about. And keep in mind, chemistry also matters. This is someone you'll likely call during the next world crisis. And as I like to say, if you live long enough, there will be one. You're likely going to need to call someone whose voice calms you down, who you trust enough to follow even when every headline out there screams disaster.

Conclusion

These seven questions are designed to start a conversation that could transform your family's financial future. The best advisors I know would be grateful if you came prepared with these questions. They know that clients who understand their approach are more likely to stay disciplined and achieve their goals. I hope these questions help you leave that first meeting feeling heard, understood, and optimistic about your future. Not because the advisor promised great returns, but because you found someone who gets you. Someone who will be your thinking partner for life's big financial decisions. The right advisor becomes part educator, part strategist, part coach, and even sometimes part counselor. And remember, the fact that you're taking this step and preparing for this conversation shows you're ready for one of the most important partnerships of your life.

Now this wraps up another episode of Retirement IQ, and I hope you're enjoying the show. I know we're having a lot of fun sharing our thoughts on everything retirement. And if you want to learn more, come visit us at freeretirementreport.ca. We would love to hear from you. Until we meet again, I'm John Stregger, and thank you for listening to Retirement IQ. Have a great day everyone.