LexION Blog

How to Choose a Financial Advisor

If you’re stuck wondering how to choose a financial advisor, you should realize that confusion is a fairly common part of the process. You’re tasked with choosing someone you can entrust to manage your life savings, after all.  In addition, the advisory world is chock full of jargon and an alphabet soup of titles.

This doesn’t have to be the case, however. Here are some painless tips on how to choose a financial advisor:

Avoid cookie-cutter advice

Each one of us has a unique financial life, with our own sets of challenges and circumstances. Unfortunately, many advisors will lump most people together with cookie cutter plans instead. To avoid misaligned advice, you’ll want an advisor who provides bespoke advice tailored to your needs and goals.

For example, your asset allocation is one of the most important investing decisions you can make. You should ask potential advisors how they choose your asset allocation: is it based on your risk tolerance and exact needs and goals? Starting an open dialogue will ensure you’re receiving customized advice.

Ensure transparency

Although the world of finance can appear confusing, the right advisor can break your investment plan down into simple, easy-to-understand language and documentation. Quite simply, you should be aware of all the moving pieces in your financial life.

To start, ask if your potential advisor will provide an Investment Policy Statement. Then, see if they encourage questions during your dialogue, and if they take the effort to ensure you have a clear sense of your investment portfolio.

Avoid brokers

Ultimately, not every financial advisor is legally required to act in your best interests. Many advisors are only legally bound to the suitability standard; which means their advice can be privy to commissions, markups and hidden fees.

If you’re wondering how to choose a financial advisor, one of your top priorities should be to find a fiduciary. Fiduciary advisors are held to a higher standard, and are legally required to act in your best interests at all times.

Learn more about how to choose a financial advisor

At LexION Capital, we’re fiduciary advisors who provide bespoke portfolios and transparent advice tailored to fit your unique needs and goals. If you’d like to learn more, let’s start a conversation today.