BETA
This is a BETA experience. You may opt-out by clicking here

More From Forbes

Edit Story

Before You Meet With A Personal Financial Advisor, Do Your Homework

Expert Panel
POST WRITTEN BY
Forbes Finance Council
This article is more than 7 years old.

No matter your current financial situation, there are plenty of great reasons to meet with a personal financial advisor. Whether you're trying to get out of debt, increase your income with investments, or simply save up for the future, an honest, trustworthy advisor can help you create a roadmap to your goals.

However, as with most relationships, you'll only get out what you put into your meeting with a financial advisor. If you go in without the proper information and mindset, it won't be a very productive or fruitful endeavor. So before you meet with an advisor, do your homework. Below, six Forbes Finance Council members, senior-level financial executives, share how you should prepare before meeting with a personal financial advisor.

1. Seek Out A Fiduciary Advisor To Meet With

I highly recommend a fiduciary advisor, because they are legally required to act in your best interests at all times. Many advisors are legally brokers, and they can take commissions and have hidden fees in their investment products. Do your due diligence and ask questions to make sure your advisor is not only a fiduciary but that they will be transparent when it comes to your wealth. - Elle KaplanLexION Capital

2. Identify Your Fixed And Variable Expenses

View your previous three months of spending habits and categorize them into fixed or variable expenses. Fixed expenses are monthly recurring bills like your mortgage. Variable expenses are items that you wouldn't incur if you lost your income, like going to the movies or out to dinner. If you aren't sure, ask your advisor on your appointment. - Troy SharpeOak Harvest Financial Group

3. Prepare An Income Statement And Personal Balance Sheet

Good financial advisors know the right questions to ask. They cannot help you unless you know the answers. Preparing a light version of your personal balance sheet and income statement can get you on your path sooner. This way, rather than organizing the past, you can focus your meeting on building the future. - Atish DavdaEquityZen

4. Know Your Own Limits And Have An Open Mind

You're going to want to be prepared with the knowledge of where you are, where you want to be and how much you're willing to sacrifice to get there. From there, listen closely. Although you may think it's in your best interest to invest a certain way, your advisor will take an objective look at your portfolio and tell you what's best – and it may not always align with what you thought. - Ryan MarquisPlastc, Inc.

Forbes Finance Council is an invitation-only organization for executives in successful accounting, financial planning and wealth management firms. Do I qualify?

5. Know Your Financial Goals

What are your financial goals? If you don't have a clear answer to this question, you may want to dig deeper into your personal finances. Outline and organize all of your financial statements and budgets. Review your investments and make note of your returns or losses. Once you truly know your numbers inside and out, you can come up with a handful of goals to bring to your financial advisor. - Domenica D'AnnaSupreme Lending

6. Understand How Much You Can Afford To Lose

A high return portfolio will come with a commensurate amount of risk. A low return portfolio will come with a low risk. So as you think about where you are in your life, your goals and your earning potential, the question you have to ask yourself truly is: How much can you afford to lose? An honest answer will allow you to find the right diversification and balance to hit your goals. - Sasha OrloffLendUp