1. How are you compensated? This means who pays you - do I pay you directly or do you get paid by the company whose products you sell? If you sell me products, what are all of my choices and why do you suggest only certain products? The point is that if you pay your advisor directly (fee only) then you may be dealing with a fiduciary. If your advisor gets paid commissions to sell you products, they may not have to put your interests first so it is important to clarify all reasons.
2. If I decide I am not happy with your investment services, what does it cost me to leave? This question is to help define any backend charges that might be called surrender charges or deferred sales charges. If you are dealing with a commissioned sales rep (ie: broker) you must know this in advance. Most of the time if you are dealing with a fee only advisor, there should be a reasonably low cost to move to another firm.
3. Will I deal directly with you or another person? What you need to know is who will answer your phone call, return your phone call, handle future meetings, and answer your emails. If you are going to be handed off to a junior associate, that might be ok but you need to know this in advance.
4. Do you have any disciplinary infractions on your record? If no, great but if yes, these should be explained in plain English to you honestly. Things happen but you should know this and be comfortable.
5. Will you do a financial plan of some sort for me? If yes, get details in advance including any charges for these services. If no, understand that you are dealing with a product salesperson. Ask if the products that could be recommended as part of the financial plan will be sold to you by the person or firm completing the plan. This might uncover a bias that you should know up front. Some firms will help you get multiple quotes for your insurance needs but will not sell these products.
