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How Do You Choose the Best Financial Advisor in Philadelphia?

Choosing an advisor in Philadelphia is a crucial step in your financial planning future. If you need help creating a financial roadmap or if you have a plan but just want to have someone review your work, an advisor is the perfect resource. Like with any relationship, you want an advisor-client relationship to be solid, beneficial and trustworthy. How do you get that you ask? Consider the basic principles and industry standards below when meeting with a potential advisor so that you can determine if your financial future is in the best hands possible. This is where we recommend you should start when looking for your own financial advisor in Philadelphia.


Are you a fiduciary?

The most important thing that we could suggest is that you ask the advisor if they are a fiduciary. A fiduciary is an advisor who is required by law to act in your best interest at all times. Most sales oriented advisors, or brokers, follow a different standard, the suitability standard. The suitability standard states that the advisor has to reasonably believe that his or her recommendation is merely suitable for you, as a client, based on your needs, objectives and other concerns. The key difference is that with the suitability standard, the advisor can sell you a product that technically suits you, but may have been chosen because it benefits the firm that they work. A fiduciary in Philadelphia won’t do this because your best interest is always first and foremost. Think of it this way - a broker will sell you a suit but a fiduciary will make sure it fits.

How do you get paid?

When you ask this question, you may run into an answer like “my company pays me.” Don’t settle for this. You can follow up with asking “how do you make money off of my account?”. The point in asking how your potential advisor gets paid is to determine if they are being paid to sell you a product. Most brokers operate under a compensation plan where the advisor gets paid based on how much product they can sell. This creates a conflict of interest and doesn’t allow your advisor to be objective. Look for a fee-only advisor in Philadelphia so you won’t have to worry about these conflicts of interest. A fee-only advisor in Philadelphia. has to uphold the fiduciary standard and they don’t receive any fees or compensation based on product sales. Instead, they are just paid a percent of your assets under management. This brings us to our next point when choosing an advisor- fees.

What is the advisor fee?

It’s a no brainer that you want to look for an advisor with low fees. After all, whatever you’re not paying your advisor in fees is money that you’re able to invest and count amongst your assets that you’ll be able to gain compound interest from. Try and find an advisor in Philadelphia that charges less than 1% for investment services. This way, you get to keep more of your money in your own pocket. Typically, a fee-only advisor will likely fall within this price range and they are likely to use ETFs and other low-cost funds to maximize your earning potential by lowering your expenses.

Are you a full service?

Lastly, look for someone who will help you with all aspects of financial planning, not just investing. See if your advisor in Philadelphia are willing to help you with your budgeting, estate planning and insurance planning, without selling you a product. Remember, financial planning is not exclusive to investing. Try and find a fiduciary advisor in Philadelphia who is willing to provide all aspects of a plan and above all, find an advisor you can connect with, who makes your concerns feel heard and makes you feel confident about achieving your financial goals. If you do that, you’ll be in good hands for the long haul.

If you're interested in learning more about financial advisors in Philadelphia, visit InvestEd's tips on how to find the best financial advisor in Philadelphia here.