Ask yourself, “Do I want someone to recommend and manage my investments or someone to sell me insurance to protect my family? –or– Do I want help with money management plus someone to give me advice on protecting me and my loved ones against death or disability, minimizing my taxes, help with my budgeting and cash flow, retirement planning, and/or legacy and estate planning?” If it’s the former, you’re looking for a financial advisor, if it’s the latter, you’re looking for a Certified Financial Planner (CFP®).
Before establishing a relationship with any financial advisor, you will want to interview several people to make sure they are a good match for you and exhibit key traits of an advisor. You can find great resources, including important questions to ask on the Certified Financial Planning (CFP®) Website.
But your situation is unique.
You not only need a professional trained in the technical side of finances, but also someone who can help you sort through the complexities of the change in your life situation. Often those changes go beyond the numbers into the personal side of your life. And certainly, you’re going to be faced with asking and answering questions that you may not have had to consider in the past. So, beyond the basics found on the CFP website, consider asking these additional questions:
- Do you have any special skill set or expertise related to widowhood? The Sudden Money Institute states “Money is both technical and personal and both sides are equally important and complex, but the personal side drives decision-making.” SMI certifies professionals in the art and science of life transitions through the Financial Transitionist® Institute. You can find Certified Financial Transitionists (CeFT®) in your area here.
- Is your planning process different if I’m in the middle of a life transition?
In a word, yes, but not all advisors recognize this. CeFTs have specialized training and tools around the human dynamics of financial change. No matter where you are in your transition process or how you’re feeling about it, CeFTs have resources to help you better understand what’s happening now and what to look out for next.
- Once I have created a financial plan, can you help me implement it? Do you then have a process for helping me monitor it to make sure that I’m staying on track? Is the financial plan tracked or only the products? What does that process look like?
Some financial advisors only sell products, some financial planners create plans but don’t sell products at all where other financial planners do both. It is important to understand the nature of your engagement and the role that your professional will play now and into the future. Define what the engagement covers and when the engagement ends. Make sure you understand the roles that your advisor will play in the implementation of your plan and monitoring its progress. Make sure that a PROCESS is in place for monitoring your plan, as well as your investments and insurance, and that you have a full understanding of what that process will look like. For example, will you be required to call the planner to schedule follow-up meetings or does the planner reach out to you on a regular basis? How regular? What ongoing costs can you expect for this service?
- How will I know if my outcome is successful? Many financial goals will not be realized until far in the future, so make sure that you have a planner with whom you have a good rapport and with whom you feel you can work long-term. Your financial plan is complete when you have a game plan that is in alignment with your goals, risk tolerance, and timeframe, as well as your definition of who you are and how you want to spend your money. It should include a list of achievable “to do” items that give you a sense of direction and confidence about your future. But to have a successful outcome, you need to move beyond the creation of a plan and into execution and tracking of the results against your goals. You will want to agree to an ongoing process that defines when to stay the course vs. when to pivot.