• Allison Castle

Questions To Ask Before You Invest

Updated: Jun 28, 2021

Most of us are not investment experts and will seek the advice of a financial advisor. These are some questions to ask before you pick your financial advisors and decide which investments are right for you and your goals.

Questions to ask about a potential financial advisor:

  1. Are you a fiduciary? A fiduciary is required to act in your best interest.

  2. Do you use an independent custodian/brokerage to hold my investments? An independent custodian/brokerage helps to ensure you are not subject to fraud, such as Ponzi schemes.

  3. How do you get paid? A Fee-only advisor may charge a percentage of what you invest and would not receive a commission on a particular product.

  4. What are my total costs and fees?

  5. What are your qualifications?

  6. How often will we meet and check in on my investments?

  7. What types of investment portfolios are available? How diverse are they?

  8. What is your investment philosophy (when to buy/to hold/ to sell, etc)?

  9. How do you determine if my investments are performing as they should be (benchmarks)?

  10. What kind of tax consequences should I expect with my investments?

Questions to ask when decided which investments are right for you:

  1. What are my goals? Why am I investing?

  2. What expectations do I have for this investment? Income, growth, both?

  3. What is my level of comfort with risk?

  4. How long do I plan to hold this investment?

  5. What are the costs?

  6. Are there any particular industries/companies I do or do not want to support?

I hope these help you get started on your search for the financial advisor and investments that are right for you!

What other questions might you ask?

Photo by Burak K from Pexels

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