A good advisor can give a lot of security and comfort when it comes to your financial future, unfortunately some advisors do not have your best interests at heart. Here are a few quick and easy tips to protect yourself from exploitative practices.
- Trust, but verify. Ask your advisor to provide services with the duty of care of a fiduciary. Identify the organizations that license or supervise them, then check their websites for their background and disciplinary history, if any.
- Never leave blanks on paperwork, and always ask for final or submitted copies that have the word "final" or "submitted" stamped on them.
- Make sure you receive regular statements from independent third-party sources, not just from your advisor.
- Always make your checks payable to the advisor's business or custodian, not to the advisor themselves. Question any situation that gives your advisor unlimited access to your money.
A great resource for checking the background of a planner or advisor can be found at Finra Broker Check.