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5 Questions to Ask a Financial Advisor

The topic of money and finances is still a big mystery for many people. And for good reason – it can be complicated stuff!

Managing finances is particularly complicated because it often involves financial investment literacy. This type of literacy relies on complicated math that often requires specific training to develop an understanding of and expertise in.

Yet, we don’t see people getting the help they need. According to a CNBC survey, over 75% of Americans are managing their own money with no help. And the remaining 25% who are getting help are mostly relying on family members and friends.

The same survey found that only 1% of Americans have sought out an expert and are using a financial advisor.

According to a study by Northwestern Mutual, 6 out of 10 Americans say they need help with their finances, so it is surprising that so few people have successfully sought it out from the experts in the industry.

Want to jumpstart your finance journey with a little money 101? Sign up for our (totally free) 3-email personal finance course.

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Helping People Get Access to Financial Expertise

One of the problems may be that while there are many efforts to help increase people’s financial literacy, there isn’t as much focus on helping people more easily get access to those who already have very high levels of financial literacy – financial advisors.

We think finding a financial advisor should be a process that the individual has control over and doesn’t require hours of research or mountains of personal information. That’s why we’ve built the first social platform that helps people more easily connect with financial advisors.

questions to ask a financial advisor

But we also know that money is a highly personal thing. Therefore, everyone should make sure they are diligent and thoughtful about who they select as an advisor.

5 Important Questions to Ask When Searching for an Advisor

Here are 5 important things we think anyone should be able to consider when searching for a financial advisor.

1. Does the advisor have the right qualifications?

First and foremost, it is important to make sure that anyone you’re considering working with is a registered financial advisor.

All advisors must register with one of the two U.S. regulatory bodies. Therefore, you can find detailed information about any advisor using the free tools from these regulators – either FINRA’s BrokerCheck system or the SEC’s Investment Advisor Public Disclosure.

finra brokercheck

Once you’ve verified someone is a financial advisor, you can take a look at any certifications they have. These may indicate who has taken steps to increase their knowledge of personal finance or where an advisor may have a particular area of expertise.

In fact, to maintain many certifications, advisors often have to do ongoing course work to ensure they are staying up to date on the latest in the finance world. A few of the common certifications you may see are:

  • Certified Financial Planner (CFP) is a designation indicating that an advisor has taken extensive coursework specific to financial planning, passed a rigorous exam and accrued three years of relevant experience.
  • Certified Public Accountant (CPA) is a designation for financial planners who specialize in accounting and taxes.
  • Chartered Financial Analyst (CFA) is a designation earned after passing three levels of rigorous examination focused on financial analysis concepts. This may indicate an advisor has particular expertise in portfolio management and investing.

2. Can you try before you buy?

With most major purchases you get the opportunity to try out the product before you commit. You test drive different cars or you go to the furniture store and sit on a number of couches before selecting one.

We believe that finding an advisor should be similar. You should have a sense for what an advisor may offer before you commit.

Ask prospective advisors to demonstrate how they could help you achieve your goals before you sign on the dotted line.

And, it’s always a good idea to know what other options are out there. If you were buying a car and only tested one option, you wouldn’t have a way to gauge whether the speed or the way it drove was good or bad.

You might have a vague idea that you did or didn’t like the experience but it would be hard to say definitively whether it was better or worse than other options out there.

In the same way, think about testing out a couple different advisors before making your selection. That way, you’ll have something to compare to and more confidence you are making the right decision

3. What value is the advisor adding?

When you are trying out a few different advisors, make sure you understand what each might actually be able to do for you. In other words, ask what the advisor is adding above and beyond what you might be able to do on your own.

An advisor should be bringing investment expertise to the table, meaning that they will likely help you develop and implement a strategy for investing your money.

It’s important to understand how those investments could improve on whatever you are doing today.

But it’s not only the investments that advisors can help with. A financial advisor may also provide advice around how much you should be saving, how you should be planning for your financial goals, where you might find extra savings or better tax strategies.

All of these things could be an improvement on what you could have done on your own. In other words, an advisor may help you reach your goals more easily or with less money or faster.

We think it’s important to ask about and understand what value each advisor might bring to the table.

4. Does their expertise match with your needs?

There are many different aspects to anyone’s financial life. And your needs and priorities change over time as you reach different life stages.

While advisors generally know how to address a broad range of financial needs, they also often have specialties.

Some may be particularly knowledgeable about retirement strategies, others may specialize in tax strategies, and yet others may have the most experience working with young professionals or small business owners.

questions to ask a financial advisor

When you’re looking for an advisor, ask about what they specialize in or the types of clients they have the most experience working with.

That way, you can determine whether any advisor you’re considering has expertise in the areas that you need help in.

Having alignment between your needs and the advisor’s specialty creates more opportunity for developing effective solutions to meet your goals.

5. Are you on the same page around your goals and priorities?

You probably have many different financial goals. And you probably have a sense of priority around those goals.

You want your financial advisor to be on the same page, especially when it comes to building financial plans to meet them.

For example, if your number one priority is to make sure you’ve saved enough money for your child’s education, you don’t want your financial advisor telling you to put extra money toward the account you have earmarked for a future house. You want them to make sure you are on track to meet your number one goal of education before focusing on other goals.

Make sure that you start out any relationship with a shared understanding of your goals and priorities.


What is a Fiduciary and Why Should You Care?

When it comes to taking control of your finances, a financial advisor can be a great addition to your team. They offer insights and access to the investment world that most people aren’t privy to – they’re basically a power-up for your financial plans.

At the same time, it can be stressful choosing an advisor. How do you know which one is a better fit for you than another? A great way to tackle this big decision is to acquire more knowledge about the game before you step off the sidelines.

For example, a huge term in the industry, and one you’ve likely heard before, is “fiduciary.” That five-syllable word packs a whole lot of meaning, so let’s break it down – beginning with what a fiduciary is and why you should care.

What (and Who) is a Fiduciary?

A fiduciary is “a person or organization that acts on behalf of another person or persons, putting their clients’ interests ahead of their own, with a duty to preserve good faith and trust.” Basically, they’ve always got your back.


In the financial world, a fiduciary is a specific type of advisor who is held to a different standard. They are required to always act in your best interest, even if it’s not necessarily in their best interest. For instance, some products advisors sell can result in a commission being earned by the advisor and/or their firm. A non-fiduciary is only required to make recommendations that are “suitable” for you, which can leave a lot of wiggle room that makes some people uncomfortable.

We don’t mean to suggest that you should only trust fiduciaries (they’re not all trustworthy), or that you should never trust non-fiduciaries. But it’s important that you understand the difference between the two to help guide your decision-making.

No advisor is entirely free of conflicts of interest when it comes to the advice they give you. Sometimes your advisor might recommend products or services, like insurance, that don’t fall under their fiduciary rules – but they are required to let you know when those moments happen.

The rules for fiduciaries are long and complex, but it’s important to know the gist of them before entering a relationship with a financial advisor. The big one to remember? A fiduciary advisor is legally required to make decisions in your best interest and always tell you about any potential conflicts of interest.

John Oliver did a great job exploring why fiduciary advisors matter on his HBO show “Last Week Tonight,” which you can see below.

Who Holds Fiduciaries Accountable?

The fiduciary rule is enforced by the Securities and Exchange Commission, AKA the SEC. After the major Wall Street crash in 1929, the federal government created the SEC to enforce rules, protect investors and prevent market manipulation. They’re the ones who are supposed to catch people like Bernie Madoff (okay, not their best moment).

All fiduciaries fall under the jurisdiction of the SEC. Non-fiduciary advisors such as broker-dealers, however, are governed by a totally separate agency (but we’ll save that for another time). The more you know!

Why Should You Care?

You need to be able to trust your advisor. After all, you’re handing over access to your assets, sharing your hopes and dreams, and entrusting them to make the most of it. For the vast majority of people, those assets represent an entire lifetime’s worth of hard work and savings.

It’s important to know what questions to ask in those consultation meetings so you get the full picture of what an advisor offers. Likewise, you also need to be aware of your legal rights.

In your search for a financial advisor, it would be wise to add the term “fiduciary” to your list of questions, as well as a few follow-up Qs to identify the full scope of the advisor’s fiduciary duty.


What Makes One Advisor a Better Fit For Me Than Another?

questions to ask a financial advisor

So you’re looking for an advisor? Great! That must mean you’re ready to start saving like you mean it!

Except… how do you actually go about choosing one? Do you just grab the first result on Google? Social media-stalk financial advisors near you?

It can be tough (and even intimidating) to choose a financial advisor, especially if you don’t know what you’re looking for. That’s why we’re walking you through the basics of financial advisors, so you can connect with advisors with confidence.

Let’s start off with a simple Q for you: what are all your lifelong financial ambitions and what timeframe do you have to reach those goals? (Okay, maybe not so simple…)

Why Do You Want an Advisor?

Okay, so maybe it’s not a simple question – but it may be the most important. A great jumping off point in your search is to ask yourself why you want an advisor in the first place. What are your goals? Do you want to start saving for retirement? Put together a down payment for your first home?

All these goals can benefit from the advice of a financial advisor.

The key here is to think about whether your main goal is short term or long term, because the investing strategies you’ll want to employ vary depending on how much time you have to put your money in the market. In that same vein, different advisors will employ different strategies for investing your money.

Grab a pen and paper and start jotting down your goals, underlining the big projects you think are most important. Having these goals on hand will help you stay on track and keep the big picture in mind during your search for a financial advisor.

What’s Important to You in an Advisor?

Think about the kind of interactions you’d like to have with your financial advisor – do you want their number on speed dial, or would you prefer an annual check-in? Do you like old-school, in-person interactions or a simple text? Whatever your communication style, chances are there’s an advisor who can deliver it.

Aside from communication, you might also want to consider geographical area. With the dawn of Zoom, most financial advisors will work with anyone anywhere, but working with someone local may be important to you. Maybe you want someone who fully understands your state’s tax codes, or maybe you just want to be able to sit down in the same room as them. Or maybe convenience is top on your list, so you’re okay with virtual meetings. If so, then you probably don’t care about geography as much.

If you have values you’re passionate about that would factor into your financial planning, you can also think about whether your advisor needs to have those same values. For example, there are advisors that specialize in faith-based financial planning. Or, if the environment is near and dear to your heart, look for an advisor with experience in eco-friendly or socially conscious investments. Whatever your passions, there is likely an advisor out there who feels the same and can help guide your finances to support the lifestyle you want.

What Else Should You Know About Advisors?

Just like Taylor Swift’s sweet musical sounds span several music genres, the term “financial advisor” can actually mean a few different things. Financial advisors vary based on their fees, legal obligations and experience.


questions to ask a financial advisorFinancial advisors have a wide variety of fee structures, but there are three main types: fee-only, commission-based and fee-based.

Fee-only advisors charge a flat price based on the hours worked, services rendered or even a certain time frame (i.e., annually). Think of it like a subscription where you pay an advisor a few hundred dollars a month for their services, and that’s how they make their money.

In contrast, commission-based advisors are paid according to investment and insurance products they sell.

Lastly, a fee-based advisor is paid through a combination of these two types, charging a flat fee for some services while earning a commission through sales on others.

Why should you care how your advisor is paid? Ultimately, it may not make a difference to you, but some people prefer to avoid working with advisors who are largely commission-based in order to avoid the appearance of being “sold” anything.

Fiduciary vs. non-fiduciary

questions to ask a financial advisor

You may have heard advisors throw around the word “fiduciary” a lot without really knowing what it means. This legal term actually packs a lot of meaning. A fiduciary advisor is required by law to always put their clients’ needs and interest before their own.

Imagine an advisor has two investments they could recommend to you:

  • Investment A could earn you 2.5% but does not have any commission for the advisor;
  • Investment B could earn you 2.49% and it comes with a little commission for the advisor.

A fiduciary advisor is required to recommend the 2.5% option because they have to operate from the perspective of your best interest, without including theirs. If the Securities and Exchanges Commission (SEC) catches them not working in their clients’ best interest, they could be in big trouble.

In contrast, a non-fiduciary advisor is not held legally responsible for acting in your best interest at all times. In fact, they may not even have to disclose any potential or actual conflicts of interest within their work. That’s why the term “fiduciary” is definitely one you should have on your radar during your search.

Still confused? Here’s John Oliver explaining it as only he can.

There are a lot of different titles for advisors – don’t get confused

Financial advisor, wealth manager, investment advisor, paraplanner, financial planner, financial coach… What is with all these different job titles?

No two advisors are alike, but just because this one calls himself a “financial advisor” and that one calls herself a “wealth manager” doesn’t necessarily mean they have different jobs.

There’s no “official” job title for advisors, so they’ve created endless variations of it, leading to endless confusion for people who just want help with their money.

Still, there are some other terms that might be good to know:

  • RIA – Registered Investment Advisor: These are independent advisory firms, meaning they’re not part of a wirehouse like Wells Fargo Advisors. They’re the fastest growing segment of advisors today, due in large part to a new crop of entrepreneurial advisors who want to be able to set their own schedule, choose their own tech, and have total control over their jobs.
  • CFP® – Certified Financial Planner: This is a professional designation advisors earn by attending college-level courses over a number of years and passing a final exam. It’s like the Ph.D. of the financial world. Advisors are not required to have it, but it’s becoming more and more prominent in use as a way to separate oneself from someone who just decided to hang an “Advisor” shingle on their front door.
  • Broker: As the name implies, a broker is an individual or firm that brokerages deals. They basically act as a middleman, buying and selling investments on behalf of investors. They’re not really there to give advice, more to just make trades on your behalf.

How Do You Know an Advisor is Right For You?

Narrow down your search according to your values. While you might think that would take a lot of time and research, Lasso actually makes the process pretty simple.

All you have to do is download the (totally free) app, build a plan based on your financial goals and BAM! You’re all set to anonymously browse hundreds of advisors. Once you find one you like, you can send them your plans and see what they’d do to help improve upon them.

Feeling good vibes? Take the convo out of Lasso and connect IRL. Don’t like their ideas? There’s no shame in the ghosting game on Lasso, so you do you.

Finding an advisor can be tough, but knowing your goals and values offers a great jumping off point to making the big decision.


What Can a Financial Advisor Help You Do?

You’re serious about saving, but how can you turn that 50k into 500k before you hit your big 50th b-day? An advisor might just be the answer.

Advisors don’t just help you invest your money anymore; often advisors are referred to as “financial planners” nowadays due to their wide array of services. Here are our top five reasons people work with financial advisors – let’s dive in. 

5 Ways Financial Advisors Help Their Clients

Financial advisors have tools and expertise to offer you in your financial planning journey, from retirement planning to tax optimization and everything in between. Today, we want to talk about the five most popular reasons people choose to work with financial advisors.

1. Save toward goals

You’ve got goals, ambitions and dreams, right? Maybe you’ve always wanted to climb Mount Everest, or open your own pet grooming business on wheels. Or perhaps your dream is as simple as a nice home for you and your ten dogs.

Whatever your goals are, you’re probably going to need some money to get there – and a financial advisor can help. 

With inflation rates at historical highs, you’re likely noticing that your cash isn’t stretching quite as far as it once did. In that same vein, the money stacked away in your savings account is likely also losing value. Over time, inflation rates outpace the interest rate your savings are earning – making it hard to stay ahead financially or to reach your long-term goals. 

The average savings account in a traditional bank earns a measly 0.1%. As of June of 2022, the national inflation rate is 9.1%. Those dollars in your savings account don’t stand a chance. In contrast, the S&P 500 boasts an average annual return of about 10.5%.

questions to ask a financial advisor

The numbers don’t lie: Investing your money is a powerful weapon you can use to combat inflation. From outlining your savings plans to investing responsibly, a financial advisor has the know-how to get you from point A to point B. 

2. Find investment opportunities aligned with risk tolerance

There’s a whole host of investment options out there for you to explore: stocks, bonds, real estate, art, crypto, even wines. It can be tough to know where to put your money to optimize your portfolio. 

In addition to what you invest in, you should also consider something called “risk tolerance.” Your risk tolerance is a delicate balance between how much money you hope to gain in a certain period of time and the amount of money you’re willing to risk losing along the way. 

For example, someone with a higher risk tolerance and a long-term goal might have a portfolio based heavily in stocks. In contrast, a low-risk investor would likely invest in more stable securities like bonds. Most people probably land somewhere in the middle with a mix of both. 

Financial advisors have the technical and real-world experience to help you decide which investment opportunities best align with both your goals and your risk tolerance. 

3. Create an estate plan

A lot of financial planning revolves around your personal goals like a house or retirement. But you also need to decide what to do with your money after you pass away. Your money doesn’t just disappear after you’re gone. 

Will you leave it to your children? Donate a portion to charity? Would you like to just be buried with all that cash and call it a day?

The entire process of planning out what will happen to assets after your death is called estate planning. Financial advisors can work closely with your lawyer to ensure your financial plan and your estate plan match up. 

If you have specific goals, questions or requests concerning your estate plan, you’ll probably want to connect with a financial advisor or other expert to help you navigate the legal processes. 

4. Optimize taxes

There’s more to tax planning than just filing your return every spring. In fact, optimizing your taxes can make a huge difference in your wallet for years to come. 

Where and how you spend and invest your money can impact your income bracket and thus your tax withholdings. A financial planner can help you look long term to make the most of your taxes both now and in the future. Just make sure to find an advisor that specifically offers tax planning services, as not all advisors do.

5. Find proper insurance 

Lastly, a financial advisor can work with you to make sure your money and other assets are properly insured. Just like you purchase insurance for your home or car, you’ll also want to find a solid insurance plan for your most valuable assets.

Likewise, an advisor can also help you explore life insurance policies to help protect your loved ones in the event of your passing or incapacitation. 

A great financial advisor works with you to explore how your finances can support all your goals, saving you time and money as you create a plan for the life you want to live.

Connect with an Advisor in Lasso

With Lasso, you can filter and browse hundreds of financial advisors totally anonymously (and free of charge). Click here to download the Lasso app and get started today.