So, how do you identify a wealth manager who is right for you? Here’s a four-step process that will prepare you well, give you confidence, and put you in control of your search. When you ultimately decide on an advisor, you will feel good about your decision because of the homework you have done here.
1. WEBSITE REVIEW
Advisor websites tend to give general information, but it's important to determine if the advisor seems to be a good match. Does the advisor seem to solve your financial concerns? Does the advisor seem to match up with the qualities and type of relationship you desire? Is their compensation model aligned with the services you need?
- Do they have a blog or newsletter and is it up to date? If not, what does that tell you?
- What topics does the blog/newsletter cover? Is it mostly investment issues or does it cover a variety of topics?
- Is the website’s overall focus on the advisor or on you and your needs?
2. INTERNET SEARCH
Type into Google or any search engine the advisor’s name or company name and see what comes up. (Make sure it’s the correct advisor/company!) Are there any surprises? Anything you want to learn more about? Is the messaging consistent with what you’ve learned about the advisor or firm through other sources?
3. LINKEDIN PROFILE AND FACEBOOK
Similar to the internet search, identify any new information and whether the content is consistent with what you’ve learned about the advisor or firm in other places.
4. FORM ADV SEARCH
Registered Investment Advisors (RIAs) are the preferred choice of most financially successful households. All RIAs are required by the Security and Exchange Commission (SEC) to file and annually update an informational document called a Form ADV, which are searchable by firm and individual names on the SEC website.
Everything from a description of the firm and the services offered, to any disciplinary actions taken against the advisor, is included in the Form ADV. The form also includes fees charged by the advisor, a description of how the advisor is compensated, and even potential conflicts of interest are available. The information advisors provide is subject to inspection and fines for inaccuracies.
The Form ADV is free, publicly available, and must be offered electronically. Better still, no personal information is required to obtain a copy so your research is completely anonymous. Perhaps the best news is that all advisory firm, regardless of size, must use the same format to present information. This makes comparing advisors infinitely easier.
Reviewing the Form ADV is not a perfect solution for answering your questions about advisors and their firms. Some of the information provided may leave you scratching your head. But it will arm you with good clarification questions to ask should you decide to take the next step and learn more about the advisor.
YOU’RE IN CONTROL
While individual websites may glamorize advisory firms, the Form ADV places the financial advice seeker in the driver’s seat. By combining the data-rich Form ADV with traditional search tools mentioned above, such as an advisor’s website and Google, you can take control of the search process. We created a step-by-step guide to help you independently research advisors.
By using these resources to research advisors, you can narrow your search to a handful of advisors who meet your criteria. What’s more, with the facts in hand, you can confidently ask questions when it comes time to interview your top candidates.