Pass On The Pitch: 5 Questions to Ask When Hiring a Financial Professional
Evaluating which pro to guide your retirement plans takes more than passively listening to a sales pitch. Speak up.


Choosing a financial professional can be a daunting task.
Most advisers I know say they actually prefer it when prospective clients check out several candidates before making a decision. It’s the one of the best ways to find a good fit.
But you can’t make an apples-to-apples comparison if you just sit and listen to a bunch of pitches. Make it an interview. Ask a lot of questions. And ask the same questions every time.

Sign up for Kiplinger’s Free E-Newsletters
Profit and prosper with the best of expert advice on investing, taxes, retirement, personal finance and more - straight to your e-mail.
Profit and prosper with the best of expert advice - straight to your e-mail.
Then you can measure the pluses and minuses of each person and what they can do for you.
Obviously trust, integrity and transparency are important qualities you want to focus on. But how do you drill down to that level at a first meeting?
Here are a few questions to get you started.
1. Are you working in my best interests? Registered Investment Advisers are fiduciaries; they’re legally and ethically required to put their clients’ interests first. Brokers are held to a different standard, which requires that they make recommendations based only on the “suitability” of an investment. The products they sell don’t have to be the best or least expensive as long as they meet the client’s needs, which can open the door to conflicts of interest. If a candidate says he’s a fiduciary, get it in writing.
2. What kind of fees will I be looking at? Get this in writing, as well. You want to know about EVERYTHING: adviser fees, custodian fees, investment management fees and trading costs. Ask about disclosed and undisclosed fees. Examples of undisclosed, or hidden fees, would include trading costs and tax implications with mutual funds, spreads on bonds, and M&E costs on annuities. Only then can you compare one adviser and the products they intend to use to the next.
3. What processes do you have in place to help make sure your recommendations are in line with my risk tolerance? Risk exposure should be a big part of your conversation with every candidate. Too often, investors just turn over their money and let an adviser pick the portfolio mix. That’s like going to the doctor and getting a prescription without talking about symptoms or getting an exam. There are many tools available to assess your comfort level and capacity for risk.
4. How will I be rewarded for taking risk? This is all about gauging performance. Once you’ve talked about risk exposure and risk tolerance, you should ask about the end result — or what you’ll get back for taking that risk. You’re trusting this person with your money, so what’s in it for you? For comparison, I suggest using an industry standard, such as the Sharpe Ratio, to compare risk/return of one portfolio to another.
5. Are the investment returns your company reports audited? Who does the auditing? You want to hear that their returns are audited by Global Investment Performance Standards (GIPS), which has the most widely accepted auditing standards. The adviser you choose should have a consistent, audited track record.
Remember: Don’t fall for a sales pitch. The clearer and more prepared an adviser is with the answers to these questions, it can help you as you make decisions on your search for a financial adviser to build a relationship with. Investing is complicated — that’s why you need help. Make sure you find someone you can communicate with and someone you can trust.
Kim Franke-Folstad contributed to this article.
Get Kiplinger Today newsletter — free
Profit and prosper with the best of Kiplinger's advice on investing, taxes, retirement, personal finance and much more. Delivered daily. Enter your email in the box and click Sign Me Up.

Chris Abts is president and founder of Cornerstone in Reno, Nevada. He holds a Series 65 securities registration and has earned the Certified Estate Planner (CEP) and Chartered Retirement Planning Counselor (CRPC) professional designations.
-
Eight Ways To Save on Your Next Luxury Trip
Looking for ways to stretch your retirement dollars? Follow these tips to get a deal on your next vacation.
-
Donating Complex Assets Doesn't Have to Be Complicated
If you're looking to donate less-conventional assets but don't know where to start, this charity executive has answers, such as considering a donor-advised fund (DAF) for its tax benefits and ease of use.
-
Donating Complex Assets Doesn't Have to Be Complicated
If you're looking to donate less-conventional assets but don't know where to start, this charity executive has answers, such as considering a donor-advised fund (DAF) for its tax benefits and ease of use.
-
Think a Repeal of the Estate Tax Wouldn't Affect You? Wrong
The wording of any law that repeals or otherwise changes the federal estate tax could have an impact on all of us. Here's what you need to know, courtesy of an estate planning and tax attorney.
-
In Your 50s? We Need to Talk About Long-Term Care
Many people don't like thinking about long-term care, but most people will need it. This financial professional recommends planning for these costs as early as possible to avoid stress later.
-
Social Security Pop Quiz: Are You Among the 89% of Americans Who'd Fail?
Shockingly few people have any clue what their Social Security benefits could be. This financial adviser notes it's essential to understand that info and when it might be best to access your benefits.
-
Such Attractive Yields in High-Grade Munis Are Rare and May Not Last Long
According to this munis expert, the last time munis were this cheap was a brief period in 2023. If you kicked yourself for missing out then, you have a second chance now.
-
Financial Analyst Sees a Bright Present for Municipal Bond Investors
High-tax-bracket investors have an excellent opportunity to secure low-volatility, high-quality returns at yield levels rarely seen in over a decade.
-
I'm an Insurance Pro: How Not to Get Dumped by Your Insurance Agent
Your insurance agent or broker might show you the door if you do any of these five things. Being a good customer is about more than paying your bill on time.
-
Two Estate Planning Issues You Should Never Overlook
This estate planning attorney explains why proper asset titling and beneficiary designations make a big difference when it's time to transfer your wealth.