Published: January 15, 2025

Over the years, we have had the pleasure of meeting many great families who were looking for an advisor. We love the opportunity to meet new people, learn about who they are and what is important to them. We often ask a lot of questions during an introductory meeting so that we can uncover what it is that truly matters to them.

Like any good relationship, communication is key, so we expect potential new clients to have questions for us as well. Some folks will ask very pointed questions, while others admit they are not sure if they are asking the right questions. Given this, we felt we could outline a few important questions you may want to ask your current or prospective investment advisor.

An advisor should outline what his or her team looks like and the services they provide. How often will you meet? Will you get a comprehensive financial or retirement plan? What reports will they provide? Do they offer additional services such as insurance solutions and tax or estate planning strategies?

We find most clients want to deal with an advisor who will be there for years to come. This question should provide you some insight as to what their typical client looks like and if the advisor has capacity to take on additional families. We feel it is important to know if you fit within their target market or existing clientele.

Currently, many firms and advisors are licensed with either the Mutual Fund Dealers Association (MFDA) or the Canadian Investment Regulatory Organization (CIRO). Often, some individuals may only offer products from their firm which will greatly limit options and hinder their ability to offer an unbiased recommendation.

Historically, the “Big Banks” acted as brokerages. Now, they are typically known as Wealth Management offices and can offer several investment products including, but not limited to: stocks, bonds, mutual funds, exchange traded funds (ETFs), alternative investments, commodities, and insurance. Generally, brokerages, or Wealth Management Offices, are not limited to offering only their own products, thereby giving investors more choices and limiting potential bias.

Regulators have worked hard improving disclosures to ensure that costs are transparent however, there tends to still be misunderstanding around fees. It is important for investors to understand all costs associated with investing and what value they are getting in return. Are there any hidden, embedded or deferred sales charges (rear loads)? Does the advisor use lower cost products where suitable/available? It can be worthwhile to ask what the fees are in terms of dollars and percentages.

Today, there are many ways for advisors to make money. Salary, commissions, bonuses and fee-based are typically the most common. More and more, our industry is moving more towards the fee-based model where investors pay a percentage fee on the assets they have with an advisor. Typically, services such as building and maintaining portfolios, wealth planning and trading costs are included.

There are numerous reasons for the shift towards fee-based compensation, among the most important is removing any "hidden" compensation. This aligns an investor's objectives with those of the advisor and can limit investment recommendations that may offer the advisor a larger commission.

There are far too many credentials and titles in our industry for us to list. However, it is worth knowing that the "Portfolio Manager" title is the only one which carries a fiduciary duty to their clients. Like a doctors or lawyers, Portfolio Managers are legally bound to always put their clients' interests first.

Another important credential to note is either the Certified Financial Planner (CFP®) or Personal Financial Planner (PFP) designation. This certification means that they have completed substantial training specific to financial planning.

Advisors should be able to explain their strategies in a simple way. What is their process for selecting investments? What research do they do? For example, we put our "Investment Philosophy and Core Beliefs” in writing.

Above all, you should feel comfortable with your advisor and feel like it is a good personality match. The best relationships are ones where people share information, have aligned goals and work together towards achieving what truly matters to them and their families.

These questions are by no means an exhaustive list, but it can provide you with a starting point when interviewing a new advisor. Hopefully this gives you a better understanding of the those you are meeting with.