How to Choose the Right Wealth Management Advisor

Behind personal relationships and health, your financial security is one of the defining aspects of a full and satisfying life. While there are many methods to improve financial security, one of the most complete approaches is to partner with a wealth management advisor. However, choosing the right one is rarely a one-size-fits-all process. Every person has a unique set of circumstances, and advisers have different portfolio management styles. Thankfully, there are some common threads that you can follow to find a wealth management firm that’s right for you.

But before we jump into the process of choosing the right advisor, it’s important to understand some key distinctions about wealth management. Unlike standard financial advisors, wealth management advisors typically specialize in protecting and helping to grow financial assets for high-net-worth individuals (HNWI). The services provided typically include tax planning, alternate investment opportunities, estate planning, and charitable giving strategies. Wealth management is a holistic approach that fills gaps in your financial security by considering your needs, goals, and circumstances.

We believe that the search for a wealth management advisor involves two main phases: Research and Consideration. The research phase is mostly introspective. It consists of identifying your goals and creating a list of desired services. After dedicating time to understanding your needs, it’s time to move into the consideration phase. This is where you’ll prepare for your decision by investigating and interviewing a list of suitable wealth management advisors.

Initial Research Steps

Before scheduling a consultation with a wealth management firm, it is important to complete a few initial research steps. By fully understanding your situation and goals, you increase the chances of partnering with a firm that aligns with your interests. It may feel like you are all alone with these initial steps, and even though we can’t personally assist you, we want you to know that we are always in your corner. We designed the following sections to help guide your research journey. Our goal is to provide an outline for finding the best wealth management advisor for your needs.

Identify Your Needs

Everyone has a different situation. A recent graduate has vastly different needs than an established professional, and a young family will have different goals than a couple approaching retirement. Understanding your current financial health and future goals will help you pick a wealth management firm that can effectively meet your complex needs. Our recommended process involves six fundamental steps.

Determine Your Total Net Worth

Your net worth is the difference between your assets and liabilities. For the purposes of initial research, you do not need to determine an exact number. Arriving at a valid approximation will be enough to identify your needs. To begin, add together all known debts and then subtract that total from your liquid assets. 

Examples of Liabilities include:

• Mortgages
• Car loans
• Student loans
• Credit card debt

Examples of Assets include:

• Real estate properties
• Retirement and savings accounts
• Cash
• Investments

It is worth noting that when calculating your total net worth for the purposes of finding a wealth advisory firm, you should only include liquid assets. A liquid asset can easily be converted into cash, so your primary residence and valuable collections such as art, wine, and jewelry typically would not be factored into your calculations.

Understand Your Cash Flow

Assets and liabilities are typically consistent and predictable, but your cash flow can fluctuate from month to month. This step will help you understand your financial goals, and arriving at a tangible number provides an insightful indication of your spending habits. Review your bank statements for the past 6-8 months and make note of the difference between income and expenses. 

Identify Financial Goals

Whether your goal is to eliminate liabilities, build an estate plan, increase passive income, or anything in between, we suggest you get an idea of what you hope to gain from partnering with a wealth advisor. Remember to involve your spouse or partner when creating the financial goals. If you are single, we suggest that you discuss your plans with a trusted acquaintance.

Create a List of Services Needed

Once you finish exploring your financial health and goals, it’s time to build a list of services that you need. HNWIs have unique and complex needs, and standard financial advisors may not be equipped to provide these services with the expertise you need. There are some services all people will need, such as tax optimization and retirement planning, but it’s how those strategies are implemented that separate a HNWI wealth management team versus a standard financial advisor. Take a look back at your financial health and goals, and then create a list of the services that may help you accomplish them. 

Common wealth management services include:

• Trust and Estate Planning
• Alternate Investments and Private Equity Opportunities
• Charitable Giving
• Real Estate Investment Advising
• Small Business Advisory
• Asset Allocation

Making the Decision

With a concrete outline of your approximated worth and desired goals, you can begin the process of searching for a wealth management advisor. Partnering with a wealth management firm is one of the most important decisions you will ever make, and it should not be rushed. Be sure to carefully consider multiple firms before making a commitment. We suggest you build a shortlist of qualified firms and then schedule consultations to confirm your priorities, interests, and ideals align.

Investigate Their Credentials

The easiest starting point when building a qualified list is to investigate the wealth advisor’s credentials. Unless they are a registered financial advisor, there are no official requirements for someone to use the title “financial advisor.” Due to this, any potential partnership must be thoroughly investigated. Among the key considerations are formal education, training, and experience working with high-net-worth clients.

One of the premier credentials for a wealth manager is the CERTIFIED FINANCIAL PLANNER™ (CFP®) certification. Earning a CFP® designation means that the financial professional has undergone a rigorous education, training, and examination process. This certification also creates an expectation of trust. A CFP® is legally bound to operate as a fiduciary, which means that every financial decision is made with the client’s best interests in mind. Advisors without credentials may suggest investments that provide high commissions for the advisor but questionable returns for the client. When you work with a fiduciary advisor, you never have to worry about the integrity of the suggestions.

Beyond certifications, be sure to perform your due diligence when examining the firm’s reputation and current clients. Direct conversation with the firm, reading case studies on the company website, and scouring customer reviews on directory listings (such as Google and Yelp) can help you find this information.

Even if a firm’s credentials check out, your work isn’t done until you research the advisors that you will be working with. Your partnership will be with the employees who make up the firm, and uncovering any disciplinary action is a major red flag. Databases such FINRA’s Broker Check and Verify a CFP® Professional are invaluable research tools*.

Note: Morgan Rosel Wealth Management is officially registered as MorganRosel, and it should be entered as such when searching the databases.

Interview The Firm

The bulk of the work is behind you, and this step marks a crucial turning point in your search for a wealth management advisor. The interview process begins during your very first communication with the firm. Take note of the timeliness and tone of their response. A quick and friendly response may indicate that the firm prioritizes their clients’ needs and treats them with respect. 

While some firms offer virtual consultations, we recommend opting for an in-person meeting. This way, you can get a full experience of the firm. Pay attention to your interactions with every member of the staff. The mark of a client-first wealth management agency is all-around hospitality. If they aren’t making an honest effort for you to feel comfortable and appreciated, there is a good chance that you will receive similar treatment as a client.

During the interview, it’s important to know what to look for. A recent survey conducted by The American College of Financial Services found that the standout characteristics of an ideal advisor include evidence of knowledge, trustworthiness, and an ability to understand their clients’ goals. If you feel pressure to commit at any point during the interview, the firm has failed to provide a welcoming atmosphere. 

Questions to Ask a Wealth Management Advisor

Everyone has a different situation, but the questions to ask during the initial interview are broadly applicable. We recommend deciding on several questions to ask and then emailing the list to your contact at the firm. If the advisor can answer each your questions, it shows that they prepared for the interview and care about your financial goals. 

Examples of questions to ask a wealth management advisor include:

• How long have you been a wealth management advisor?
• Which professional designations do you hold?
• What is your fee structure?
• What is your investment philosophy?
• Do you have asset minimums?
• Have you or your firm ever been subject to disciplinary actions? If so, what are they and why?
• How many clients do you currently work with?
• Who will be my primary contact?
• Tell me about a client with similar goals to my own and how you helped them.
• How often do you meet with clients and provide updates?

What is the Best Way to Find a Wealth Management Advisor?

The best way to find a wealth management advisor is to understand your goals and search for a firm with a history of helping similar clients. Online reviews, word of mouth, and interviewing the firm will steer you in the direction of the best advisor in your area. Remember that you are entering into a partnership, and the firm you select should be able to grow and adapt with your changing needs. 

At Morgan Rosel Wealth Management, our goal is to help guide, guard, and grow your financial wellbeing. Our CERTIFIED FINANCIAL PLANNER™ advisors commit themselves to fulfilling a fiduciary duty and will always put your best interests first. The decision to partner with a wealth management advisor is a big one, and we feel up to the task. If you are ready to start living life by design, we’d love to talk to you. Reach out to schedule your consultation today.