7 Ways to Find a Financial Advisor Near You

·8 min read
SmartAsset: Financial Advisors for Young Adults
SmartAsset: Financial Advisors for Young Adults

Young adults face distinct financial opportunities, including early career challenges, figuring out how best to handle student loans, renting or buying a residence, starting a retirement savings program and even having children. Investing priorities are also distinct for young adults. For example, if you’re in the Gen Y cohort (born from 1981 to 1995) your investment priorities may include a focus on socially responsible investing (SRI) or environmental, social and governmental (ESG) investing. Luckily, there are financial advisors who are especially equipped to help guide clients as they face these challenges and opportunities.

If you’re looking for a qualified financial advisor, SmartAsset’s free tool can match you with up to three financial advisors who serve your area.

What Is a Financial Advisor?

A financial advisor is a professional with credentials and years of experience managing investments, solving tax problems, creating financial plans, and more. No one qualification makes someone a financial advisor, and they come from various educational backgrounds. However, financial advisors often earn certifications such as certified financial planner (CFP) to hone their skills and demonstrate competency.

Financial advisors can help younger adults in numerous ways. For example, if you want to create a financial plan, start saving for retirement or a child’s education or begin investing in the stock market, a financial advisor can provide expert guidance in these areas and more.

How Much Does a Financial Advisor Cost?

Typically, financial advisors charge clients about 1% of the assets managed. For this fee, financial advisors usually help with taxes, investing and setting financial goals.

Fees higher than 1% could cost you hundreds of thousands of dollars over your career. To avoid paying more than you have to, ask your financial advisor how they make money and what fees you’ll incur. In addition, financial advisors sometimes receive commissions for putting your money into certain investments, which raise your expenses above the usual 1%. Therefore, it’s a good idea to understand the fees before committing to a financial advisor.

On the other hand, some financial advisors charge annual or hourly fees. Others may solely receive investment commissions and could prioritize the payout from specific funds instead of your best interests. Fortunately, many financial advisors are fiduciaries, meaning the law obligates them to act in your best interest.

Whether your financial advisor charges a flat fee or makes commissions from investments, it’s crucial to understand and be comfortable with how your financial advisor makes money. If you can’t get a straight answer about fees or something feels off, it may be a sign to find a different financial advisor.

If your needs aren’t too complex and you want to cut down fees, a robo-advisor may be the financial service for you. Robo-advisors charge between 0.25% and 0.5% of the assets managed. As a result, you could get the investment services and financial guidance you need for half the price of a human advisor. While robo-advisors may not have the breadth and depth of services of a financial advisor, you can easily start an investment account with low expenses.

7 Ways to Find a Financial Advisor

SmartAsset: Financial Advisors for Young Adults
SmartAsset: Financial Advisors for Young Adults

When trying to find a financial advisor, here are seven options available to help:

  • Online search. A search tool such as SmartAsset’s free financial advisor matching tool can simplify the process. By answering a few questions, you can match with up to three local financial advisors, interview each of them and decide which one is a fit for you. Best of all, it’s free.

  • XY Planning Network aims to connect younger clients with specialized financial advisors.

  • The Garrett Planning Network offers a nationwide database of financial advisors who serve middle-class Americans.

  • The Certified Financial Planner Board of Standards connects you with a certified financial planner (CFP) who can help you invest, pay down debt efficiently and make a financial plan.

  • The National Association of Personal Financial Advisors (NAPFA), where you can find fee-only financial advisors.

  • A robo-advisor such as Betterment will let you create an investment portfolio with no account minimums and an annual fee of just 0.25%.

  • org can help you find a local accredited financial counselor specializing in debt management.

  • Personal connections. Your friends, family and coworkers may provide excellent referrals for financial advising services. Someone in a similar financial situation might be able to direct you to the right fit.

What to Consider When Looking for a Financial Advisor

Just as every client has different financial priorities, financial advisors have different strong suits. Here are 10 things to consider when deciding on which financial advisor can help you:

Credentials. Financial advisors can earn various credentials, and the following may fit your needs:

Size of firm. Financial advisors can fly solo, work with a few associates or join companies of hundreds of financial professionals. You might find you’re more comfortable in an individualized setting without much bustle.

Conversely, you might be attracted to a prominent financial management firm that has demonstrated success and serves countless clients like you. In any case, it’s vital to trust your financial advisor and have peace about how the company or individual manages your wealth.

Expertise. Certifications signify the kind of help a financial advisor can give you. However, finding out which of the following topics your financial advisor focuses on can help you decide if they’re can serve your needs and promote your financial wellness.

Student debt. Americans have $1.6 trillion in student debt, so if you’re struggling, you’re not alone. A financial advisor can help you consolidate student loans and pay them off efficiently.

Taxes. Whether you’re wondering how your 401(k) or FSA designations affect your taxable income or are unsure about the tax implications of starting an individual retirement account (IRA), your financial advisor can help you navigate the complex world of taxes.

Retirement. Retirement may be far away, and that’s a good thing – you have more time to invest. Creating a retirement plan is important, and the earlier you make one, the better set you’ll be to leave the workforce after a fruitful career. A financial advisor will help create a retirement plan based on the income level you want during your golden years.

Investing. Investing is crucial for retirement, but it’s also a way to save for vacations, a child’s college education and more. A financial advisor can lay out your investment options and help you invest wisely.

Virtual or in-person meetings. COVID-19 changed how business is done in almost every industry, and finance is no exception. As a result, many financial advisors accommodate clients’ preferences for meeting in person or virtually.

Minimum requirements. Financial advisors sometimes have wealth stipulations for clients who want to use their services. For example, you may need $1,000 to put into an investment to get started with a particular financial advisor. Therefore, whether a financial advisor requires you to have $10,000 or $1 million may prevent you from working with them. Remember, robo-advisors are a viable choice because they have low or no minimums.

Fee structure. Fees are an essential point when choosing a financial advisor. Before putting your hard-earned money into someone else’s hands or following their financial advice, it’s vital that you trust them. Trust can only come when you understand how your financial advisor is paid. A financial advisor who goes into detail about your needs and is transparent with their business practices can bring you peace of mind.

It’s a good idea to find someone who connects with you and works hard to make you successful. That said, if something doesn’t seem right when you meet with a financial advisor, don’t be afraid to take your business elsewhere.

Questions to ask financial advisor candidates: When asking about advisor abilities and certifications, these eight questions can help you determine whether they’re the right fit:

  • What certifications do you have, and what clientele do you primarily serve?

  • Do you have experience with younger clients?

  • Are you a fiduciary?

  • Do you have any disclosures, such as criminal activity or customer complaints?

  • What services do you provide?

  • What fees do you charge?

  • What’s your investment style?

  • How often will we meet and/or communicate?

Bottom Line

SmartAsset: Financial Advisors for Young Adults
SmartAsset: Financial Advisors for Young Adults

With inflation, student debt and questions about planning a successful financial future, young adults and professionals have pressing money needs. Financial advisors can provide help, but it’s critical to find one that has credentials that fit your situation and charges fees that make sense to you. Fortunately, finding a financial advisor is easier than ever. With various online tools and your personal and professional network at your disposal, you can quickly research a selection of financial advisors to start interviewing.

Financial Advisor Tips

  • SmartAsset’s free tool matches you with up to three financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.

  • If you’re just starting to invest, working with a robo-advisor may be helpful. Robo-advisors offer portfolio management services just like traditional financial advisors, but they typically have lower fees and account minimums. These are the top 10 robo-advisors.

Photo credit: ©iStock.com/Kerkez, ©iStock.com/izkes, ©iStock.com/Ridofranz

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