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How to Choose a Credible Financial Advisor

August 16, 2021 Blog

When choosing an advisor to help plot your financial future, it is important to make an informed decision. While many financial advisors are extremely good at what they do, others are not; and, unfortunately, there are also many advisors (or “advisors”) who make their money by taking advantage of unsuspecting investors.

So, how do you choose a credible financial advisor? Below, our financial fraud attorney provides some steps to take as well as some red flags to avoid:

5 Steps to Take When Choosing a Financial Advisor

1. Ask for Recommendations

One of the best ways to choose a credible financial advisor is to ask for recommendations from friends, family members or coworkers. If someone you know and trust has worked with a financial advisor for years, then there is a good chance that the financial advisor is trustworthy as well.

On the same token, if a friend, family member or coworker recommends against using a particular financial advisor, this is advice you should also take to heart. Additionally, if someone says that their advisor “seems okay” but then goes on to discuss concerns such as having difficulty communicating or not being sure how their money is being invested, it will likely be in your best interests to seek another recommendation from someone else.  

2. Ask Lots of Questions

When you meet with a financial advisor for the first time, you should ask lots of questions. You can come prepared with a list, and you should feel comfortable seeking out any information you want to know. For example, some questions you may want to ask before choosing a financial advisor include:

  • How long have you been a financial advisor?
  • How many clients do you have currently?
  • Do you have a lot of long-term clients?
  • How long have you been with your current firm? Why did you leave your old one?
  • Have you ever had a complaint filed against you?

If a financial advisor tries to avoid certain questions, seems evasive in general or rushes your appointment, these are all potentially bad signs. While you can certainly follow up if you don’t get the answer you want, there are also plenty of other credible financial advisors who will be more than happy to answer any questions you may have.

3. Ask for References

In addition to asking questions, you can also ask for references. This will be especially important if you choose a financial advisor on your own rather than getting a recommendation. You can contact the advisor’s references by phone or email. When you contact them, keep your inquiry brief to respect their time, and don’t be afraid to ask directly whether they would recommend the advisor based on their personal experience.

4. Our Financial Fraud Attorney Encourages You to Do Your Own Research

Beyond talking to a financial advisor and his or her references, you should also do some independent research. Read the advisor’s profile on the advisory firm’s website, read any reviews you can find online, and see if the advisor is registered through FINRA BrokerCheck or your state’s registration authority.  You can also search for articles that mention the advisor by name, and you can seek to verify the advisor’s credentials through the relevant institutions or organizations.

5. Make Your Own Decision

Ultimately, when choosing a financial advisor, you need to make your own decision. Don’t let a financial advisor talk you into using his or her services, and don’t rely solely on other people’s advice. Take the time to gather as much information as you need to make an informed decision; and, if you have concerns about engaging a financial advisor for any reason, start the process over to find someone else.

5 Red Flags When Choosing a Financial Advisor

1. You Can’t Figure Out if the Financial Advisor is Registered

If a financial advisor’s registration information is not available through FINRA BrokerCheck or your state’s registration authority, then there is a good chance that he or she is not registered. Any good financial fraud attorney knows that this is a major red flag, and you should go ahead and start looking for a different advisor.

2. The Financial Advisor Is Using High-Pressure Sales Tactics

Credible financial advisors will not use high-pressure sales tactics. In fact, they won’t use any sales tactics at all. They will simply answer your questions, provide information about their services, and then allow you to make your own decision about whether to move forward.

3. The Financial Advisor Isn’t Willing to Provide Information

A credible financial advisor will expect you to have questions and concerns—and he or she will be more than happy to provide you with information as a result. If a financial advisor isn’t willing to provide information about his or her background, complaint history, firm affiliation or any particular investment products, this is also cause for concern.

4. You Can’t Get Any Information in Writing

Does the financial advisor seem to only want to provide information in person or over the phone? Is there a noticeable lack of information about the advisor or any recommended investment opportunities available online? Credible financial advisors will provide plenty of information in writing, and they will have written disclosure materials at the ready for any investments they recommend.  As a result, if an advisor calls every time you send an email, or if you can’t seem to get any information in writing, this is certainly a factor to consider when evaluating the advisor’s credibility.  

5. The Financial Advisor is Promising High Returns or “Exclusive” Investments

Finally, promises of high returns, “exclusive” investments and limited-time opportunities are hallmarks of financial fraud scams. No credible financial advisor will guarantee any degree of success, nor will any credible financial advisor try to rush you into an investment decision. These types of promises and offers should raise immediate concerns, and they should steer you toward choosing a different advisor.

Our Financial Fraud Attorney Represents Individual Investors Nationwide

Each financial fraud attorney at Zamansky LLC provides nationwide legal representation for investors who have fallen victim to financial advisor fraud. If you have any questions or concerns about the credibility of your financial advisor, you can call 212-742-1414 or contact us online for a confidential consultation.

Client Reviews

“Jake Zamasky and his colleagues represented me in a FINRA arbitration case against a large multinational bank and succeeded in obtaining an award for the full amount of my investment losses. I would highly recommend the Zamansky firm for their experience in securities litigation, their level of detailed research and case preparation, and their ability to effectively fight for what’s right.”

Richard R.

“Throughout my entire case, Jake Zamansky was incredibly responsive and spent time walking me through each step of the process. He is professional and worked with my challenging schedule, even meeting with me nights and on weekends. He knew exactly which turn to take when it came to my case and yet was respectful of any decisions I wanted to make resulting in a positive outcome.”

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“Jake Zamansky and his firm represented me in a FINRA arbitration case to recover investment losses. Jake and his team were very professional and worked very hard preparing for trial and then reaching a substantial settlement of our case. I would highly recommend them.”

William E.

“Jake Zamansky represented me in a FINRA arbitration case which allowed me to recover a substantial portion of investment losses. He is truly an expert in this space and I would highly recommend him to those investors who may have been been a victim of investment fraud.”

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