Working with a financial professional

Your financial professional is an experienced financial professional who will help you work toward your financial goals. Here’s how to optimize that critical relationship.

The financial world is a complex one to navigate. New investment products, global investing opportunities, employee-driven 401(k)s — these (and many more) collectively underscore the value of seeking professional financial advice.

As you transition from going-it-alone to working with a financial professional, there are a few key points to consider.

Standards of Professionalism

The term “financial professional” is often used loosely to characterize anyone receives compensation for providing financial guidance. But there is a stark difference between self-proclamation and industry-certification, with the latter carrying with it objective standards of competence.

Financial professionals can earn industry certifications by completing accredited courses of study. For instance, there is a Certified Financial PlannerTM (CFP®) certification, which is awarded by the Certified Financial Planner Board of Standards Inc.; the Chartered Financial Consultant® (ChFC®) designation, which is awarded by the American College of Financial Services; and the Registered Financial Consultant (RFC®)), which is awarded by the International Association of Registered Financial Consultants.

Many financial professionals are also accountants, lawyers, stockbrokers, or insurance agents, each which contributes complimentary skills and training to contribute to one’s financial stability. For instance, an attorney who specializes in estate planning can serve as a financial professional for retirement planning or estate and trust planning

Fees and Expenses

Financial professionals are compensated in different ways. Some bill for their time only, and do not sell products or services; others earn a commission transactions, such as when their client buys or sell stocks and bonds; and still others charge both a fee and commission for their work

Value Benefits

Managing your financial affairs can be complex and challenging. A financial professional can help you evaluate and assess your financial goals and tax liabilities, while pursuing a strategy that aligns with your risk tolerance.

Many will present you with a written financial plan that helps you pursue and adhere to your goals. It will also help you readjust tactics should your financial circumstances change

Selecting a Professional

In working with a financial professional, it’s helpful to understand the person’s background and training to determine whether there is a good fit for you. Important questions to ask include:

• Why did you become a financial professional?

• What is your training and background?

• Do you offer specific or general recommendations?

• How do you implement your recommendations?

• Which services and advice do you provide (i.e.accounting, estate planning, etc.)

• Do you work with a team of other professional to assist you? If so, which ones, and what are their specialties?

• How do you communicate with your clients (method, frequency)?

• Do you perform annual reviews?

Relationship Building

When you first meet with your financial professional, be transparent about your financial needs and financial goals. This is not as easy as it sounds. A skilled professional should be able to ask you questions that help you clarify your goals, if necessary.

In preparation for your meeting, ask the professional what documents you should bring. Examples include your will, insurance policies, pension information, and investment account statements.

Prepare to discuss key subject areas, such as retirement, cash flow, savings, college, emergency funds, and estate planning.

Fee-based Financial Professionals

After you have developed clear investment goals and strategies, your professional will prepare a financial plan for you to review. The plan will include major objectives, like having minimal amount of insurance, creating cash reserves for an emergency, and tactics for reaching your short- and long-term goals.

The plan may also include recommendations for changing your portfolio to align with your risk tolerance and overall financial goals. It may also recommend where to invest future income and savings.

Once you finalize the plan with your professional, you will schedule annual reviews to make sure that the plan suits your current circumstances and the progress you are making toward your goals.

By partnering with a financial professional, you are making a commitment to take better control of your finances and create a structured path toward a more secure financial future.

Advisory accounts may not be appropriate for every investor. A brokerage account may be more appropriate for every investor. A brokerage account may be more appropriate if you prefer a buy-and-hold strategy for a long period of time, AND/OR prefer to make the investment decisions yourself, seeking a financial advisor only to provide occasional recommendations and execute orders


Disclaimer: This material is for general information only and is not intended to provide specific advice or recommendations for any individual. There is no assurance that the views or strategies discussed are suitable for all investors or will yield positive outcomes. Investing involves risks including possible loss of principal. Source/Disclaimer: *Interest income may be subject to the alternative minimum tax. Municipal bonds are federally taxfree but other state and local taxes may apply. There is no guarantee that a diversified portfolio will enhance overall returns or outperform a nondiversified portfolio. Diversification does not protect against market risks. Qualified accounts such as 401(k)s and traditional IRAs are accounts funded with tax deductible contributions in which any earnings are tax deferred until withdrawn, usually after retirement age. Unless certain criteria are met, IRS penalties and income taxes may apply on any withdrawals taken prior to age 59.. RMDs (required minimum distributions) must generally be taken by the account holder within the year after turning 73. Prior to investing in a 529 Plan investors should consider whether the investor’s or designated beneficiary’s home state offers any state tax or other state benefits such as financial aid, scholarship funds, and protection from creditors that are only available for investments in such state’s qualified tuition program. Withdrawals used for qualified expenses are federally tax free. Tax treatment at the state level may vary. This material was prepared for Crystal Rickard and does not necessarily represent the views of the presenting party, nor their affiliates. This information has been derived from sources believed to be accurate. Please note – investing involves risk, and past performance is no guarantee of future results. The publisher is not engaged in rendering legal, accounting or other professional services. If assistance is needed, the reader is advised to engage the services of a competent professional. This information should not be construed as investment, tax or legal advice and may not be relied on for the purpose of avoiding any Federal tax penalty.