10 Characteristics of Great Financial Advisors

What makes a financial advisor “great”? Most people seek advisors who are competent, trustworthy, and strategic, but truly great advisors have much more to offer. Considering that a beneficial relationship with a financial advisor could last a lifetime, we believe it’s important to choose an advisor who embodies more than the standard professional requirements. Here are 10 attributes you might consider when seeking the right advisor for you and your family:

• They have a vision and a mission. Great advisors focus on doing the right things, knowing that they’ve done their best to set their clients up for success.
• They have a clear, defined process. Managing finances can be a complex task, and it can be easy to overlook a necessary step. In his book, The Checklist Manifesto, author Atul Gawande discusses errors of ignorance (mistakes people make because they don’t know what they don’t know) and errors of ineptitude (mistakes people make because they don’t properly use what they DO know). When situations are complex, it’s easy for an otherwise capable financial advisor to miss something – unless they follow a consistent process. Great advisors have a defined process that helps to ensure they don’t make critical errors with your hard-earned nest egg.
• They are great listeners. According to the Harvard Business Review, great listeners don’t talk when others are speaking; they show that they are listening by responding verbally or with facial expressions, and they can repeat what others have said, practically word for word. In addition, they create a safe environment for discussing difficult, complex, or emotional issues. Instead of immediately offering solutions, they seek to understand the problem first. How well does your financial advisor listen to your ideas or concerns?
• They are with their clients on the journey. There’s a saying that to understand the needs of another person, you should walk a mile in their shoes. However, because each person’s situation is different, great advisors walk alongside their clients. That way, when the client’s feet hurt, it’s likely the advisor’s do too. This type of empathy can help motivate a great advisor to listen deeply, find new solutions, and share in their client’s success.
• They are curious. Great advisors really get to know their clients and learn what’s meaningful to them. They understand that often, it’s not really about the money – it’s about what the money can do to help their clients achieve what’s important to them.
• They manage expectations. While it may sound dreamy to “get rich quick,” great advisors know it’s not realistic, and they work with clients to manage expectations around investment returns. They help their clients understand how the markets work and that a disciplined, long-term approach will likely help their clients pursue a better investment experience.
• They don’t rest on their laurels. Great advisors realize their clients’ needs are ever-changing, and they seek opportunities for continuous improvement to better serve them. This could include embracing new technology, keeping up with best practices for security, or considering different asset classes to help clients pursue their financial goals.
• They follow a code of ethics. Great advisors place their clients’ interests first and work to either help mitigate any potential conflicts of interest as much as they can when working with clients. They also communicate as much as possible to help clients understand risks, fees, and other information critical to their decision-making processes.
• They are lifelong learners. No industry is static. Great advisors recognize the need for continuing professional development throughout their careers, and pride themselves on staying up-to-date on the latest trends and industry best practices. They pursue advanced degrees and/or professional certifications to stay current.

Finding the right advisor can require a bit of homework to ensure a good fit, and while good “chemistry” is important, it shouldn’t be the only criterion. We believe asking thoughtful questions, observing behavior, and conducting your own due diligence can go a long way toward helping you distinguish between a “good” advisor ad a great one.