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Questions to Ask a Financial Advisor – Part 1

by | Aug 8, 2023

Hiring for any professional service can be difficult. Finding a competent, reliable, and trustworthy professional when you might not even know exactly what you are looking for can be even more challenging. Here are 3 questions that you should ask your current or prospective financial advisor. Along with the question, we will provide why it is important, and how the Odyssey Group would answer each one.

Is the advisor a fiduciary?

A fiduciary is legally required to put their clients’ best interest first and to operate transparently and tries to minimize conflicts when possible. You might be thinking to yourself, “Of course I want a fiduciary. Why isn’t everyone in the financial planning profession one?”  Sadly, there are plenty in the industry who work based upon a lower standard of care.

The Odyssey Group’s advisors work as fiduciaries when providing wealth management and financial planning services for a fee.

How is the advisor compensated?

Financial advisor compensation varies across the board and there is no “right” or “wrong” way for an advisor to get compensated. However, it is important for you, as the client, to understand how the advisor is compensated so there are no surprises or misgivings about the product being sold or the services to be provided. Typical compensation arrangements include advice by the hour, flat fee, commission for product sold, or fee based on the amount of assets being managed.

The Odyssey Group charges our clients a percentage of assets under our management.

Who will be handling the relationship going forward and what type of communication can you expect?

While there are still plenty of solo practitioners in the financial planning industry, most are moving towards a team-based approach.

The solo practitioner does it all – planning, trading, reviews, scheduling, phone calls, etc. They will be your contact for the relationship going forward.

A team-based approach benefits from the skills of a larger staff to help ensure flawless execution of your financial strategy, but it is important that you have a clear point person for your relationship. In some team settings, the advisor that initially laid out the plan may not be the one to follow through with its execution.

The plan execution and future relationship management may be handed off to a junior member of the team. While this model may work fine, you should know who you will be working with.

An open line of communication between the advisor and client is crucial when financial matters are at stake. The client shouldn’t feel uncomfortable to call, email, or schedule an appointment with their advisor to review their situation or portfolio. While there is no standard in the industry, an annual review is common.

The Odyssey Group uses a team-based approach to best serve the needs of its clients. The advisor you initially work with will continue to lead the relationship into the future and leverage the team for strategy implementation and execution. 

The Odyssey Group prides itself in proactively reaching out to clients during major market events, to schedule reviews, or to just check-in. Rarely will an email or voicemail go without response for more than a few hours.  And while we like to meet with our clients at least once a year, we will meet as many times as needed to make sure the client is satisfied.

If your current or prospective advisor can’t answer these questions with confidence and to your satisfaction, it is probably time to move on. We’d be happy to discuss our philosophy and how we work with our clients. Please contact us here.