Many people arrive at a point in their lives where they reach out to a financial advisor. It may be an accumulation of savings in a money market account that is paying a fraction of a percent in interest. It could be a life event such as retirement or the sale of a business. Or maybe it is a large windfall of money through an inheritance or a legal settlement. Regardless of what the trigger is, most people aren’t exactly sure what to expect when they sit down with a financial advisor for the first time.   

One of the more common perceptions is that there will be a sales pitch of some sort. The expectation is for you to tell the advisor how much you want to invest, and he or she sells you on where to put it. The reality is that the advisor should be doing a lot more listening than talking in the first meeting. Sure, you should have questions and the advisor should have answers. However, a true advisor will ask you questions and take the time to fully understand your situation.

The questions the advisor will ask can be very personal. The most common questions will pertain to income, savings and debt. However, it doesn’t stop there. Your goals and expectations are a critical part of the situation. The advisor needs to understand what type of investor you are, your attitude towards risk and how to utilize what you have to help you reach your goals. The conversation will go far beyond the extra earnings you are hoping to get on your money.

While it may be difficult to open up to someone else about some of this very personal information, it is in your best interest to be as transparent as possible. The advisor is going to give you much better advice with a full understanding of your situation. Most advisors, particularly CFP Professionals, are held to a code of confidentiality so don’t let that be a hurdle. Furthermore, if you are concerned about that, you can ask. If the advisor isn’t asking any questions, that should be a red flag and if you walk out of the meeting wondering where the pitch was, that is likely a good thing.

Disclosures