You may think you don’t have enough money or assets to use a financial advisor. You’re likely wrong about that. A financial advisor can help you build wealth regardless of how much wealth you’re starting out with. But you need to be very careful when selecting a financial advisor. These professionals will have insights into every aspect of your financial life. They need to be reputable, trustworthy, ethical and committed.
Find Out: Never Do These 3 Things With Your Money, Says Personal Finance Pro Humphrey Yang
Read Next: Mark Cuban Tells Americans To Stock Up on Consumables as Trump's Tariffs Hit -- Here's What To Buy
On her website, financial guru Suze Orman posted a blog exploring eight red flags to watch out for when choosing a financial advisor. Don’t settle for any financial professional who exhibits or does any of the following.
They Cold Call You
Are you getting a random phone call from a so-called financial advisor and you did nothing to spur it? Hang up. “A successful advisor doesn’t have to look for clients,” Orman wrote. “Clients seek her or him out.
Explore More: 10 Genius Things Warren Buffett Says To Do With Your Money
They Show Up at Your Door
Just as you should hang up if a financial advisor you’ve never heard of/contacted calls you, you should slam the door if one shows up to your home. A financial advisor worth your time and money will be too busy for such weird outings. “When I was seeing clients … I didn’t have time to breathe, let alone get in a car and drive for half an hour across town to a client’s home and then drive back again,” Orman wrote.
They Have a Sloppy Office
Presentation matters. If you pay a visit to a financial advisor and get a sense of clutter or chaos from their office, that’s a red flag that should cause you to run.
They’re Not Interested in Meeting With Your Spouse/Partner
If you’re enmeshed with a spouse or life partner, your financial advisor will want to know how finances work between you. They’ll want more than just an explanation from you; they’ll also want to talk with your partner. If you consult a financial advisor who doesn’t mind if you don’t bring your partner along, move on (unless you have an incredibly valid reason to leave them behind).
They Don’t Ask You These 9 Questions
Orman noted that a good financial advisor will always ask you the following questions.
- How is your health?
- Are you in debt?
- Are you responsible for aging parents?
- Do you have a will or trust?
- Will you inherit money someday?
- Do you need to make a major purchase like a new car or a new roof for your home?
- Do you have a retirement plan? Are you funding it to the maximum allowed by law?
- Do you have adequate insurance?
- Are you saving for your children’s education?
If your financial advisor isn’t very inquisitive about these matters, they’re not worth your time or money .
They Are Not a CFP
When working with a financial advisor, make sure they are a certified financial planner, or CFP® professional, as Orman is.
“That means that he or she cares enough about his or her clients to have gone through a two-year certification process, with continuing education requirements mandating that he or she stay up-to-date on the kinds of information that you need,” Orman said.
They Aren’t Upfront or Transparent About How They Get Paid
You should not be forced to ask a financial advisor how they get paid. They should serve up this information upfront and transparently. Orman stressed to go for a fee-only advisor, as opposed to one who charges a percentage.
They Ask for Payment To Themselves Directly
A trustworthy financial advisor will not ask you to make out a check or Zelle to their name. They will ask you to remit payment to a brokerage, an insurance company or another financial services firm.
More From GOBankingRates
- 7 McDonald's Toys Worth Way More Today
- 5 Old Navy Items Retirees Need To Buy Ahead of Fall
- 4 Things You Should Do When Your Salary Hits $100K
- 5 Types of Cars Retirees Should Stay Away From Buying
This article originally appeared on GOBankingRates.com: Suze Orman: 8 Red Flags To Avoid When Choosing a Financial Advisor
