Wealth manager speaks with couple in office

Choosing the Right Wealth Manager: Key Questions to Ask

Wealth manager speaks with couple in office

Managing wealth can be a daunting task, especially given how complicated today’s financial landscape is. Whether you’re planning for retirement, building your investment portfolio, or safeguarding your assets for future generations, having the right wealth manager by your side is crucial. Selecting an appropriate advisor for wealth management is a critical decision that can have a significant impact on your ability to achieve your financial goals. That’s why it’s so important to find an advisor you are comfortable with and who can meet your specific needs.

But with so many options available, how do you choose the right advisor?
At HighPoint Advisors, LLC, we aim to help clients in Syracuse, central New York, and other markets make informed decisions about wealth management. Asking the following questions can help you make an informed decision about a wealth manager who aligns with your financial goals and values.

Does the Advisor Have a Minimum Asset Requirement?

Knowing if an advisor has a minimum asset requirement will determine whether that advisor’s services are accessible to you. Some wealth managers cater exclusively to high-net-worth individuals, while others may serve a broader client base. Make sure the advisor is a fit for your current situation.

What Is the Advisor’s Fee or Cost Structure?

Ask how the advisor is compensated. Is the advisor fee-only, commission-based, or a combination? Also, inquire about management fees, transaction costs, and any other charges associated with their services. Sometimes an engagement may require fees paid directly from the client accounts (asset level fees, platform costs, etc.), while other times the fees may be billed directly to the client (hourly consulting, subscription fees, etc.). While fees are only a very small variable in the relationship, you should understand how these fees will impact performance over time.

What Are the Advisor’s Qualifications and Experience?

Experience often correlates with expertise. How many years in the industry, as well as how long an advisor has served clients with needs similar to your own, are helpful things to know. Most investors want to feel comfortable that an advisor has the ability and experience to navigate various complex financial situations over time. A clean regulatory record is also important for establishing that comfort level. All financial professionals’ industry experience is listed at FINRA BrokerCheck.

In today’s competitive market, many clients look for professional certifications such as Certified Financial Planner (CFP), or Chartered Financial Consultant (ChFC), for example. These designations demonstrate a commitment to professional standards and ongoing education. It may also be necessary to know if the advisor has any areas of specialization. For example, the Chartered Special Needs Consultant (ChSNC) designation focuses on planning for individuals with special needs.

Is the Advisor a Fiduciary?

A fiduciary is legally obligated to act in the client’s best interest in advisory relationships, and put the client’s interests ahead of his or her own interests. This is an important distinction, as some financial advisors are only required to provide “suitable” recommendations, which may not always align with the client’s best interests. While acting as a fiduciary, the advisor must disclose and mitigate any conflicts of interest, when applicable.

Do Clients Stay With the Advisor?

Client retention can offer insights into the advisor’s ability to build and maintain meaningful long-term relationships and provide desired results. A high client retention rate often indicates client satisfaction and trust in the advisor’s services, while a low retention rate may mean that clients were not satisfied or that there were issues with the advisor’s services.

What Is the Advisor’s Wealth Management and Investment Philosophy?

What strategies does the advisor use to manage client investment portfolios? Do they favor active or passive management for investing? How do they attempt to minimize costs? Whether they prioritize capital preservation, growth, income generation, or a combination of these objectives, ensure their philosophy aligns with your financial goals and risk tolerance.

What Strategies for Asset Allocation Are Used?

Asset allocation is central to portfolio management. Ask about the advisor’s allocation strategy, which could include their diversification approach, and how they allocate a portfolio among various types of accounts, products, and security types. This will provide insights into how they can tailor portfolios to align with your unique circumstances and objectives.

How Does the Advisor Communicate With Clients?

Effective communication is key to a successful advisor-client relationship, so inquire about their service model and communication style. Clarify the frequency and channels of communication, whether it’s regular portfolio reviews, market updates, or ad-hoc discussions as needed. Nowadays there are many ways to communicate – do they prefer to meet in person, or do they prefer phone conversations or virtual meetings? It’s also helpful to know what types of contact to expect (or are available) outside of regular meetings.

How Are Costs Minimized?

Inquire about the strategies the advisor employs to minimize costs while maximizing returns. This may sometimes include using low-cost investment vehicles, different types of management styles, having access to lower-cost investment platforms, tax-efficient strategies, and negotiating favorable terms with third-party providers. While you should never invest based on costs alone, it’s important to be aware of fees and costs.

What Is the Advisor’s Approach to Risk Management?

Assess the advisor’s risk management framework, including their strategies for mitigating downside risk and preserving capital during market downturns. How do they intend to handle turbulent market conditions? Some portfolios may attempt to be “all weather” portfolios that intend to ride out the ups and downs of the markets over time, while other portfolios may be designed to be actively monitored and traded to make changes as the economy changes. Make sure their approach matches your needs.

What Other Services Does the Advisor Offer Beyond Investment Management?

Look for a wealth manager who can provide comprehensive financial planning, tax strategies, estate planning, or any other holistic planning services that you may require. The service offerings of advisors can vary widely from those who are general practitioners to those who specialize in narrow market niches.

How Does the Advisor Stay Informed About Market Trends and Industry Developments?

The financial and economic landscape is constantly evolving, and clients need to know that their advisor is staying current. Does the advisor stay abreast of market trends, regulatory changes, and emerging investment opportunities through continuous education, research, and participation in professional networks or industry events?

Is HighPoint Advisors, LLC, Right for You?

Choosing the right wealth manager is a significant decision that can have a profound impact on your financial well-being. This article suggests some pertinent questions that should be helpful with conducting your due diligence. Hopefully, you can find an advisor who not only possesses the requisite expertise and qualifications but also shares your vision for financial success. Remember, the best fit is one that aligns with your unique financial situation and goals.

At HighPoint Advisors, LLC, we serve a wide range of clients in the Syracuse, NY, area and beyond. Our clients vary in age, profession, financial position, needs, and geographic location. We have experienced advisors who are ready to help you navigate the many complex areas of financial and wealth planning.

Contact us today to see if we are a good fit for you!

Investing includes risks, including fluctuating prices and loss of principal. No strategy assures success or protects against loss.
Asset allocation does not ensure a profit or protect against a loss.
HighPoint Advisors, LLC. and LPL Financial do not provide tax or legal advice or services. Please consult your tax or legal advisor regarding your specific situation.
Scroll to Top