photo by  emdot

Our financial advisers at Paragon Wealth Management have written articles with tips on the best ways to select a financial adviser. They recommend asking these five questions before deciding which financial adviser is best to hire for your asset management.

1- Is the financial adviser fiduciary? Does the adviser have fiduciary responsibility?
2- What is the adviser’s experience? How many years have they been managing money?
3- What is the adviser’s track record? Can they show you their performance history?
4- Is the adviser paid on commissions? If so, you should not talk to them.
5- Does the adviser charge a surrender fee if you decide to leave? They should not charge a surrender fee.

To add onto this list, I would like to add these seven questions from the Wall Street Journal. Some of them are similar to the questions above. 

Excerpts taken from the Wall Street Journal on April 13, 2009

Seven Questions to Ask When Picking a Financial Adviser
Written by Shelly Banjo

1- What is the adviser’s background? Wayne Cooper suggests, “thinking like an employer.” Look at the potential adviser’s criminal and regulatory record as well as references from past employers.

2- What do the adviser’s clients say? Don’t depend on the reputation of a big firm or recommendations from friends, family, etc. Ask the adviser’s clients. They might have a different story.

3- How does the adviser get paid? This will help you know if the adviser is working in your best interest.

4- Where are the adviser’s checks and balances? When you purchase investments, make sure you are writing checks to a third-party custodian, like Fidelity Investments Co. or Charles Schwab & Co., not to your financial adviser directly. Also, find out what auditors the adviser’s firm uses.

5- What is the adviser’s track record? The adviser should be able to show you a track record. Don’t let them use an excuse of why they can’t show it to you.

6- Can the adviser put it in writing? Ask for a formal written outline of the services the adviser will be providing and what fees you will be paying.

7- What do other pros think? It’s imperative that you double-check any big moves-especially in this turbulent economy. That means knowing the basics behind your investments, insurance, estate planning and taxes and then turning to other experts for confirmation.