Finding a Financial Advisor Who Shares Your Vision and Goals

Jessica Sclafani: Welcome to T. Rowe Price’s CONFIDENT CONVERSATIONS® on Retirement. I'm Jessica Sclafani, and I'm excited to be your host this season. As a retirement strategist, I've spent years helping people make sense of retirement, both the numbers and the emotions behind them. Together with my colleagues, we'll explore practical insights to help you retire confidently.

Today, we're diving into one of the most important decisions you can make for your financial future. Finding the right financial advisor. Building on our earlier season three conversation about the value of financial advice. Today I'm joined by two wonderful colleagues, CERTIFIED FINANCIAL PLANNER™ professionals Emily Herstein and Matt Spratt.

Jessica Sclafani: I'm so glad to be joined by Matt and Emily today because as part of their roles at T. Rowe Price, they build teams of financial advisors. So when I say we have the opportunity to talk with the experts about searching for a financial advisor, this is who they are. Matt and Emily.

Emily Herstein: Thanks, Jessica.

I'm happy to be here. This is a great topic.

Matt Spratt: It's great to be here.

Jessica Sclafani: Okay, before we dive into the nuts and bolts of finding an advisor, I'd love for you both to share a little bit about yourselves and why, given your years of experience, you think it's so important for people to find the right financial advisor. Emily, let's get started with you.

Emily Herstein: Thanks, Jessica. I've been a financial professional for a long time. I don't want to date myself, but right after college, I got into the financial industry and mostly working in a bank program and helping bank clients. I bring that up because those clients typically aren't comfortable with an advisor in the typical brokerage field, what it was back in the late 90s.

And I think that pairs perfectly with our topic today of finding the right advisor. I felt I had a lot to offer in that I wasn't a typical broker in my suspenders and, you know, just graduated college young male. And I was able to connect with my clients. So throughout the years that's been important to me is finding clients that I feel comfortable with and that really feel comfortable with me as well.

In my years of experience, from there, I went on to work in an RIA, a registered investment advisor that focused on financial planning for women for similar reasons, and in my years as a CERTIFIED FINANCIAL PLANNER™ professional, I've seen how the right relationship can really be transformational. But the wrong match can be the opposite of that.

So finding someone that you are not comfortable with and that you are not like-minded can mean that even when given the same advice to two people, one person who you're not comfortable with, you're going to make poor decisions because you don't trust the person sitting across from you. So I've really seen how finding someone who you connect with can change. It can make or break your financial success.

Jessica Sclafani: I love how you talked about comfort, Emily, and that's something that will explore more today. But that is so key, right? You have to choose someone that you feel comfortable with, and that will be a unique decision to you as an individual.

Emily Herstein: Exactly.

Jessica Sclafani: Matt, how about you?

Matt Spratt: So one of the things that I really loved about what Emily was saying is, you know, the relationship with the financial advisor can be transformative. So, you know, I'm in this industry because I want to help people. I personally believe that our personal financial lives are too complicated.

And a good advisor can really help bring clarity to that process. And the reason that I got into this industry to begin with is because I've seen in my personal life the impact that poor personal finance can have on a person, even at equivalent income levels, equivalent asset levels versus somebody who doesn't have the financial guidance or help or insight that can make a real difference.

A little bit of knowledge goes a long way in this field. So I think, yes, absolutely. Getting that knowledge from your advisor can be a great way to do it. But I also think it has to come with, to Emily's point, the comfort and the desire of that person to help you, not just to be a salesperson for you.

Jessica Sclafani: And you're so right, Matt, I'm glad that we can start our conversation today by acknowledging that people's personal financial lives are just so complex. We don't have any trouble: If you're not feeling well, you go to a doctor, right? If you need to talk some things through, you see a therapist. I feel like it would be great if we could get to a place where we don't expect ourselves to be financial experts, and rather, we expect ourselves to get some support from a financial expert.

Matt Spratt: I really love what you said about, like going to doctors and going to, like therapists. I often talk to people who are looking for a financial advisor, and I often talk to people who want to become financial advisors. And I often tell people that the job of being a financial advisor is 50% the technicals, the investing, the writing of financial plans and in the execution of those plans. But the other 50% of the job is being a financial therapist and helping somebody understand their own emotions in relationship to their plan.

Jessica Sclafani: Matt, you're totally speaking my language right now because one of the key themes that I've tried to bring to the season of this podcast is that the numbers matter, but the emotions behind those numbers matter just as much. Great. Thanks, Matt and Emily.

Now let's get started with the basics. When someone realizes they need financial advice, what should their very first steps be in finding the right advisor?

Emily Herstein: Jessica, I think the first thing is for people to start with honest self-reflection. What kind of specific help do you need? Do you need retirement planning, investment management, tax strategy, or are you looking for more comprehensive planning? And you may not know, and a good adviser is going to help you figure that out.

But you need to do some self-reflection before you come to the table. You know, I've had clients in the past who think that they need investment management because they hear that buzzword, right? And they think that they need help picking out the right equities or the right bonds just because they hear these things in from their friends or in podcasts or they read about it and what they really need is help, retirement planning and figuring out how they should be invested to stay on track for for retirement.

So it's not so much investment management but comprehensive planning. I think also consider your communication preferences. Do you want frequent check ins or are you somebody that wants a lot of hand-holding? Or do you want, ah, somebody to set it and forget it. Just talk to me every once in a while or when something happens.

And additionally, do you want face to face or virtual? I was talking to my mom about this when it came to her doctor, she found this great doctor. But the doctor wanted to meet in person. And my mom has some mobility issues and the doctor's office was far away, so it was a real struggle for her to get there.

And I said, you know, this is the greatest doctor in the world, but if you can't get there, if you're not comfortable, if you're going to be off your game because of your commute and trying to find parking and all these things that make you frazzled, your appointment with her is not going to be effective because you're not going to be focused on it.

And I think it's the same thing when we're talking about finding the right advisor. If you're somebody that prefers that in-person connection, then you need to find an advisor who meets in person. Similarly, if you're, you know, want somebody who's virtual because you don't have a lot of time, then you need to find somebody who obviously is comfortable meeting that way.

And then what's your comfort level with technology? I think it's in the same vein. If you're not comfortable on a zoom call or, you know, the advisor does everything online in the, you know, in a mobile app or dashboard, and you're not a tech savvy person and don't want to be, then that's not going to be the right advisor for you.

Everybody offers similar products and services, but you have to find one that fits your needs. I would also say to ask trusted friends, family and professionals for referrals. Sometimes that's the best way is, you know, word of mouth. But keep in mind that their situation may be different than yours.

So what they found as a good advisor again may not work for your preferences. This will help narrow down significantly the type of working relationship that that you have. But also it's an opportunity to think about the value of advice. I had a client who thought financial advice was only for very wealthy, right?

And so they never even thought about it. It goes back to what I said in my intro. A lot of my bank clients thought they didn't have enough money for an advisor, but when we sat down and broke down, the cost of the advice versus avoiding one mistake or not investing because you were scared to get started. The numbers made sense and it really wasn't a matter of cost anymore.

So really be honest with yourself. And then the last thing I'll say is don't rush the process. This is a long-term relationship. Or it should be if you find the right advisor. And that's going to take time. Same with finding the right doctor. Sometimes you have to go to a couple therapists or a couple of primary care physicians to find somebody that you really click with.

And it is the same for your financial health as it is for your mental or physical health.

Matt Spratt: I love what you said there, Emily and I. I think there's a lot of value in finding the right fit for you both from a a products and services and cost standpoint, but also from the type of person that you're interacting with. I always tell people one of the things that is really fun and challenging about financial planning is that it's a little bit of art and a little bit of science.

So one of the things that I always encourage clients to do is be really clear about what their goals and values are first, right? That informs the conversation that you have with your advisor to tell them, hey, my goals are: I want to be able to leave a legacy for my kids. I want to be able to take vacations. I want to be able to retire at 65.

Now, those are some of the technicals, but also some of it is, hey, is your advisor helping you work through those technicals? As you start to think about it, you know you want to take a vacation every year. Are they helping you start work through? How much is that going to cost you? Ballpark, do you think, and how do we plan for that appropriately?

Emily mentioned that you it can be a good place to start to explore existing financial relationships that you that you may have. Your 401(k) company, for example, may offer other services that are applicable to you that you may want. I think this is a great place to start with a place that you have an existing relationship, assuming that that relationship is a good one and that you that is a place that you trust and value.

I think there's some other places that you can check as an individual as well. There are a lot of digital resources out there. I would point people at things like the CFP Board has a directory of CERTIFIED FINANCIAL PLANNER™ practitioners that from a variety of different firms that you can look at, for example,

I think using these tools to help narrow your search can help speed the process up. But ultimately, what Emily said of making sure that you find the right fit with the right advisor who can understand your needs and makes you feel comfortable talking about your needs, is really key.

So I think another thing that clients should think about is you're going to get what you're looking for. And what I mean by that is if you are looking for somebody to help you manage insurance, you go to an insurance company. If you're looking for somebody to help you manage investments, go to an investment company. I think that many of the clients that I talk to assume that they're all the same, that we all have the same things to offer.

And in some cases that's true. But there are some pretty significant differences between these industries. If you're looking for estate planning help, you're probably looking for a lawyer. If you're looking for financial planning help, you're probably looking for somebody who has a certified financial planner designation that can provide you with a comprehensive plan that evaluates multiple areas of your of your financial life.

If you're looking for just investment help, an investment manager can help. Taxes tend to be something that you look to a certified public accountant for or a CPA for. These are really useful exercises, but in my experience, CPAs are really busy, especially around tax time. Some of them do offer auxiliary services, but I think it's important to know what somebody's expertise is and go to them for their expertise. They may not be as expert in the auxiliary services that they provide.

Emily Herstein: I think it kind of goes back to the doctor example I was saying a minute ago. Right. You can go in and ask your primary care provider about your cholesterol, but she's probably going to send you to a cardiologist, right. Or ask your primary care also maybe about, I don't know, your bunions on your feet or something. I don't know, you don't have to worry about that. That's something that women have to worry about.

Jessica Sclafani: I was going to say, were you pointing at my feet?

Emily Herstein: And I was like, looking at my own. But they'll probably then send you to a podiatrist, right? So it's really important. And same thing. You could ask your cardiologist maybe a question about your weight, but they may send you to a doctor that specializes in weight management, like a dietitian. Right.

So they probably have enough knowledge to be able to help you a little bit in all those topics, but it's important to find someone that is appropriately matched to what you're looking for.

Matt Spratt: What a great point. I really think what you're saying there is that you shouldn't try to force your primary care physician to be a cardiologist. Exactly. Or vice versa. You shouldn't try to go to your cardiologist and ask them about, hey, I've got, like, a cold going on. Can you help me out with that? I think it's very much the same thing with financial professionals.

You don't necessarily want your insurance agent who helps you with your car insurance being the one to tell you whether or not you're on track for long term retirement. They might give you an answer, but the answer might not be based on their particular expertise.

Jessica Sclafani: And the good news, in case people listening are now overwhelmed by how many experts they might need to manage their financial situations. In my experience, my advisor has been a really helpful conduit to connecting me with the right people. So if you can find that financial advisor that you have a strong foundational relationship with you, they can set you on a path to address some of those auxiliary issues that you described.

Matt. And I have to say, you know, there's there's been a lot of rigorous head nodding on my part, listening to both of you.

Emily Herstein: Ditto.

Jessica Sclafani: And just a few things that I'm really grateful we we addressed head on. One is that advisors aren't only for rich people. Head nodding, but can I get a yes? Yes.

Emily Herstein: That is very true. And I think definitely a myth that needs busting.

Jessica Sclafani: Yes. And I would never want someone to think that they don't qualify for a financial advisor. There are lots of different types of financial advisors. And that brings me to, you know, one of our consistent themes here is you have to find the one that is the right fit for you. I can be a little bit of a people pleaser, and this is not an example of where you want to be the people pleaser.

Exactly. You need to find someone that meets your preferences and your specific needs. And then finally, just a tactical thing. Matt, I'm so glad that you referenced the CFP Board resource. Let's make a plan. I think for our listeners, that could be something they might want to take advantage of.

Matt Spratt: I completely agree. And yeah, I love that we're busting the myth that, uh, planning is only for rich people. I think to to my earlier point, like, I think that's sort of a part of my own personal mission statement, is helping people understand that the right support from the right professionals can really make a difference in the end.

Jessica Sclafani: The reality is, money is a part of all of our lives in some shape or form, but our financial priorities are probably very different from one person to the next. And that's where a financial advisor can help us form those priorities and then meet them. So this is all been really helpful guidance on how to get started, which I think we all know regardless of what you're doing, that first step is often the hardest. So hopefully we've given some ideas for how to get started.

I am aware that there are so many different types of financial professionals out there, and that we can very quickly get into a situation of alphabet soup as it relates to credentials. So I'd love for you, Matt, maybe to talk through some of the common credentials and what they mean.

Matt Spratt: Happy to do it. I think there's there's a few different credentials out there that you're going to hear regularly. You've heard us talk about the CERTIFIED FINANCIAL PLANNER™ designation. That's the gold standard in comprehensive financial planning. It means that the people who have attained that have gone through a rigorous education program focusing on investments, retirement, retirement accounts, estate planning and insurance, as well as taxes, taking a comprehensive exam, and had years of experience that they have demonstrated their ability to work through those different areas of the of the curriculum.

There are other designations out there that you'll hear commonly. CFA is another common one, Chartered Financial Analyst. I think of CFAs as stock pickers, as the people who do the deep fundamental analysis of companies, both their credit and their their equity, and choose those different pieces.

They can be an advisor. I have seen several advisors who are CFAs. They have a really deep knowledge of the understanding of the companies that are operating and how to analyze them. Where the CFA designation doesn't get as deep on is the personal finance aspect that the CFP really takes a deep dive on.

You'll also hear CPA or Certified Public Accountant. This is an accounting designation. It is very rigorous and requires a lot of schooling around the idea of how do you account for the money? I think what's important for people to know about public accounting is that it is often taking stock of what has happened, where money was spent, where it is going to be spent, and most of the CPAs that my clients have interacted with and have given them guidance, or that we've worked together on situations on usually give advice in a one year out kind of way.

Hey you, you made too much money this year. You should probably think about doing these things to reduce your tax burden. Things like that. Some will go further and we'll go further out, but that's a rare occurrence. One of the things that you said, Jessica, that really resonates with me, is talking about how your financial advisor, if you need other professionals, can be a liaison to those other places.

I often talk to the advisors on my team about similar concepts just thinking about in our practice. We don't do estate planning, for example, but there are aspects of estate planning that really touch what we do, right? The beneficiaries, the types of accounts that you have set up. So it is important that we have knowledge in that area to be able to help our clients understand the way that they have things structured.

The way I put it to my advisors is, hey, you're not going to be the person to write their will or create their trust, but what you can do is point. Show them that some of the key considerations that they have would benefit from some of these other professionals, and ideally By defining some of those things for them and pointing them in the right direction.

What you end up saving them is billable hours on a lawyer's docket, speeding up the process. When they do find these other other professionals who are going to get into those more specific situations that they have needs for. And that's what I love about being in the more holistic financial planning side of things, is that you get to see the whole picture, and then you can point at different areas to say, hey, this isn't necessarily our specific area of expertise and advice, but here are some things that you should be thinking about in this area that could help enhance your plan even further.

Jessica Sclafani: Things you should be thinking about being key. So it's not necessarily the individual's responsibility to be thinking about all these different aspects of their financial lives that they need to be addressing. The advisor can can bring that up. Again, just a personal example here and since you brought up the word will.

I feel like I can bring it up now too? Not the most fun topic, but you know, recently that was an agenda with an agenda item with my advisor. Do you have a will? And because my advisor is a good fit for me, he knows the names of my kids. So he was able to say, your kids would really appreciate it if you had a will. This is something you should think about.

And I don't want I don't even want to think about wills. So I was just so grateful that he brought it up to me proactively. And now it's one less thing that I have to think about for my family.

Matt Spratt: I mean, kudos to your advisor for being upfront and being willing to talk about a topic that they probably know is not a comfortable topic for clients. But that's the job is sometimes you have to be willing to have those hard conversations regardless.

Emily Herstein: And if you have the right fit in your advisor, I keep going. You know, we keep going back to this like comfort level and fit, but the right Person for you will understand your preferences in communication and your personality and know how to position those tough conversations, right? Some people need somebody very direct.

Some people maybe do better with somebody kind of hinting at things. And your advisor, if they know, you should know, you know how you like to be communicated to and what would be effective. I would also say in regards to the credentials is don't get overwhelmed by credentials alone. Experience and fit matter just as much.

You might find somebody who has all of these letters after their name, and you don't connect with them. They don't resonate with you. They don't have a similar life experience as you do. And so they may not be able to speak to the things that concern you, and maybe they can. So it can go either way, but don't focus just on the credentials.

They are important and you want to find somebody who has experience and has had the training and the background and, you know, passed the tests and and done all the things to get licensed or certified, whatever it may be. But that alone isn't a reason to hire somebody. Also, look for advisors who pursue continuing education, because that way they're staying relevant and understand the changes in the industry.

You can also check their regulatory records through FINRA, which has a tool called BrokerCheck that anyone can access. And you can see your advisors or brokers past experience where they were worked, how long they were there, and if they had anything that was reportable on their record, you'd be able to find that.

And same with the SEC has an Investment Adviser Public Disclosure (IAPD) database. So same thing. You can check and see about their background, how many years they've worked at various institutions, and make sure that that aligns with what you're looking for.

I would also think about team structure. So some advisors are sole practitioners. Some also work in a team. And so think about would you be working primarily with the lead advisor or their support staff. And sometimes that's a good thing. If they have support staff it frees them up to spend more time with those difficult conversations and their support staff handle some of the paperwork and administrative stuff, but just consider that right.

Are you hiring somebody that you're never going to talk to? Or are you hiring somebody who doesn't have the support staff and they're going to be so busy they don't have time for you? It just depends on their structure, and then also, if you're exploring advisory services through existing financial institutions, make sure you ask about the credentials and experience of that specific advisor that you'd be working with.

So established firms often have a rigorous hiring practice and standards. Matt and I both go through this a lot as we're hiring and ongoing training programs, but make sure whoever you will be working with is is part of that. And then remember that the quote unquote, for the advisor, for the listeners at home who can't see him doing air quotes, the best advisor on paper isn't necessarily the best advisor for you, right?

What they have on paper, maybe all the licenses, all the education, all the designations, but they may not understand your needs and wants. They may not be similar to you. You know, I spend a lot of time working with clients who were single moms because I'm a single mom. And I found that that was important because I could understand what they were going through. And then maybe similar. If you have a unique challenge or situation, you may want somebody who is like you, who looks like you, has been through what you’ve been through and has your perspective.

So just remember, on paper, it's just like dating, right? I may find somebody who fits all my criteria, but if we go on a date and I can't have a conversation with them, it doesn't matter if they checked all my boxes, right?

Matt Spratt: That's a really good point. I'll add in one one more technical question that should probably be asked to anybody who you're considering as your advisor, and that is asking them if they're a fiduciary. The fiduciary standard is a standard of at its core, the basics of it are making sure that you're putting the client's needs in front of your own.

As an advisor, that's an important we should all be doing that anyway. This job is about helping people, but some of the professionals that are out there are not acting in a fiduciary capacity, and that should be something that you should know upfront. I think this also goes along with most investment managers, if they're providing advice, are required to have a form called a Form ADV.

This is a really good form to to tell you about the basic structure that they disclose to the securities regulators, it's required to be delivered to you. It is a long, detailed paper that has lots of really great information in it, but is not exactly the most fun to read, but can be useful in understanding how the business that you're interacting with operates with their clients.

And that would be a place where I would expect that they would put on paper in black and white, that they are a fiduciary.

Jessica Sclafani: And are you a fiduciary and how do you get paid? Right? Yeah, I think we all want to be polite, but it's polite in this scenario to just ask very directly, how do you get paid?

Matt Spratt: What a great point. I mean, we talk about finance all day as advisors and investors, right? Those are not usually comfortable conversations to be having in the general population. So just like that is not a usual I'm not usually going to ask somebody that I meet on the street. So talk to me about how much you have invested for retirement.

That is a common question that I'm going to ask in these interactions, because it's necessary information. To your point, asking how they're compensated is a part of that conversation. You wouldn't walk up to somebody on the street and say, hey, how much do you make? But if you're going to be putting this person in charge of managing your investments, your insurance, your estate, all of these things, you should know how they're being paid and if their interests align with yours.

Emily Herstein: Exactly. And most advisors should be comfortable explaining their compensation structure. Right? If there's nothing for them to hide, there are your partner. You should want them to be compensated, because then they're going to stick around and have a long standing relationship with you. If they're not making money, they can't stick around and be by your side because they're not going to be able to pay their own bills, right?

So having a clear understanding is important, I think, for both parties, because it takes some of that used car sales. Many, you know, maybe a stereotype that some people have of brokers, advisors, investment professionals, insurance agents, whatever. It takes that off the table when both parties are aligned with how they're compensated.

Jessica Sclafani: And if the individual can't readily answer, are you a fiduciary? How do you get compensated? How do you get paid? Would it be fair to say those would be red flags?

Matt Spratt: I would say at a minimum, they're yellow flags.

Jessica Sclafani: Okay. Okay. Right.

Matt Spratt: You should be aware of these things as any advisor. This should be a part of your daily life. You're getting asked these questions regularly by clients. You should be able to answer them. I have a hard time judging an advisor for stumbling over their words in any one moment, but you should feel confident in the answer regardless of whether or not they stumbled over it to begin with.

Uh, but yeah, I do think that at a minimum, that should be a good indicator to you. And if nothing else feels right about the relationship, I think you should go with your gut.

Jessica Sclafani: Go with your gut. I like it. So we talked a lot about credentials and the importance of doing your research. When considering who you'd like to work with as a financial professional. Now, when you actually sit down with that potential professional advisor, the conversation itself can tell you a lot kind of building on what you just alluded to, Matt.

So, let's talk about more questions that would be helpful to ask. And then the other side of the coin, what we should be listening for in these conversations. Emily, do you want to kick us off with this one?

Emily Herstein: Yeah, definitely. So some of the questions that I think it's important to ask, you know, what is your investment philosophy and how do you help your clients stay disciplined during market volatility? A lot of the job of your advisor is to be your financial therapist, so to speak, and talk you off the ledges.

So you want someone with a clear, consistent approach. And a good answer might include how they handled the markets in 2008 or March 2020. How do they communicate with their clients? What was their philosophy? That would be something I would listen for. And one examples of another thing is how do you customize your advice for different clients?

You want to avoid anyone with a one-size-fits-all solution. Because all of our lives are different, our financial goals are different, even to people who on paper are the same, you know, the same age, retiring at the same time, similar goals, their feelings about it maybe different. They're just slight tweaks.

We're all individuals, so you want to make sure you have an advisor who also has individualized approaches. And then what's your process for onboarding new clients and developing financial plans. You want to make sure that they're thorough and it shows their professionalism. They want to, you know, you want somebody who has a regimen.

This is how I do things, and it'll help you stay organized as well. If you know kind of what you're signing up for, so to speak. How often will we meet and how do you communicate? I kind of mentioned this before when we talked about finding the right fit, but you want someone that it matches your expectations.

If you want regular check ins but your advisor doesn't offer them, you want to know that upfront. So that's an important question to ask and vice versa. You might be somebody who doesn't want to talk like, don't talk to me. Just let I just trust you to do it. And if you're calling me all the time, but that's not what I wanted, that's not good either. And listen for whether they ask as many questions as they answer. Right. The best advisors are curious about your situation. They need to ask questions to get to know you as well. So it shouldn't be a one sided relationship at all. And don't be afraid to shop around if you're not feeling drawn to one particular adviser.

This isn't a process that should be rushed. Go out and meet with a couple advisors and find the one that speaks to you. I said it before. We all offer very similar products and services. It's finding someone who you are comfortable with. It's like interviewing doctors, right? You can go to three different doctors, and they're going to probably give you the same advice or the same bloodwork, put you on the same medications, but find somebody that you're comfortable having those conversations with.

It's the same. Our financial health and our physical health very similar. So treat it the same and shop around. Find somebody you like.

Matt Spratt: I love the idea of finding somebody that you like. That's that's really key to the whole relationship and and key to how you're going to feel, not just when you're shopping in the good times usually, but also how you're going to feel in the bad times when things start to pull back in the markets, for example, you're going to want to know that you have somebody who you're comfortable with going and expressing your true fears.

I think some of the other questions that are really good to ask, we touched on earlier on compensation. Right. I think it's also important to understand are there conflicts of interest there in that compensation. So some advisors are compensated by the products that you buy. That's not necessarily a deal breaker to start, but you should know that up front and understand that that has an influence on the advisor one way or the other. It's an incentive.

Another good question that I wish more clients would ask is what happens when you, my advisor, retire or if something unforeseen were to happen? Who was there to pick up the pieces? Emily, you touched on earlier. You know, what kind of team structure are you in? Right. Does this mean that there's just another advisor who already knows me and steps in and helps?

How do you keep track of my information and my plan? Things like that can often be a difference maker between the a company that you choose that has a continuity over time. Because let's be honest, this is a people business where all people and many advisors have the desire to do things like retire, and if they retire before you do, that might be a challenge for you as to what the continuity of your plan is.

I think one of the other important questions that you should not only ask, but also feel is how do you help your clients through difficult concepts or making difficult decisions? The job of being a financial advisor is one where you are taking complexity and simplifying it to people who are outside of the industry.

That's the base job. If you don't feel comfortable with the explanations that you're getting, if you feel talked down to or condescended to, that's probably not somebody who is going to help you feel good when you come to them, and you're trying to tell them how you really feel about what's going on with your portfolio or the markets.

I think it should be, you know, the thing I coach advisors through regularly and that I try to coach myself through when I talk to clients, is my job is to take these really big rocks that are difficult decisions to make and break them down into bite sized pieces. Understanding where the client is coming from and what their needs are and what they value.

So we talked a little bit earlier about knowing what your goals and values are. Lots of different options about how we can deal with those big rocks. But if I know what your goals and values are, I should be able to break it down into simple, easy to understand language to make it easy for you to go. Yes, that strategy makes sense to me and I can execute on it. And if I can't do that, that's probably not the right advisor for you.

Emily Herstein: I think we've made a lot of analogies, or I've made a lot of analogies and references to financial professionals and medical professionals. But I think one we kind of take for granted is that the role of a financial advisor is a teacher, right? So when you're saying these things, Matt, what I'm thinking of is it's like my daughter and her math teacher, his job.

Right. And I say this because we've been struggling with math homework a little bit. So it's fresh on my brain. But his job is to explain these difficult math concepts in a way that she can understand. But ultimately she's the one that needs to understand it. Right? So the financial professional that you work with should teach you.

They should explain these concepts to you in a way that you understand, so that you're kind of the student and they're the teacher, and then you are

part of that decision making process. They are not making these decisions for you. Their job is to educate you and for you guys to make these decisions together.

Jessica Sclafani: So what I'm hearing is another myth to add to our myth busting list. So we talked about the first one. You don't have to be rich to work with a financial advisor. The second one that I'm hearing is you don't need to be a financial planning expert to work with one, either. What I was noticing a lot of the questions that you shared actually don't relate to specific investments or the markets or the economy. And so I think that's really helpful to understand.

So overall, Matt, Emily, you've you've rattled off several questions that I think can be helpful when shopping for a financial advisor. And, Emily, I'd love to come back to something that you started to touch on, which was the planning process itself.

So let's narrow our focus a little bit there and talk about how should someone evaluate the financial advisors planning process.

Emily Herstein: I'm glad we're diving into this more because that's really what it's about. Right. Is goal setting and helping you as the client reach your goals? So a good advisor should start with a comprehensive discovery. Really finding out not just your finances, not just what's on paper, but the emotions behind it.

I always used to tell clients, I need to know why you have that money there, and I don't just need to know that you have your money at XYZ institution. But why did you put that money in XYZ institution? What is it for? What was your decision making process? Because we want to know as advisors about your fears, your values, your dreams, because that's how we can help get you to your goal.

It's not just having money to invest. It's making sure that you're comfortable and can sleep at night, and we are keeping you on track. Also recognizing your fears. So you know, if you have a client who is scared of running out of money, we want to know that as an advisor. So your advisor should be asking you the whys behind it.

Okay. You're scared about running out of money or that you're never going to be able to retire. Where does that come from? And maybe they had a parent who lived through the Great Depression. Maybe they saw a parent work well into their 80s just to keep the bills being paid right. It's important to know the whys.

The other thing I would do is look for a structured planning process with clear steps and timelines. We are going to do this our next meeting. We're going to do that. So you know what to expect. That's really important. It'll help you prepare if you know what steps are next. They should also help you prioritize competing goals and make trade off decisions.

A lot of my clients wanted to retire and send their kids to college, so we'd have to have some tough conversations about which took priority, what concessions they could make. You know what's possible, what's not. What are you willing to do and what are you not willing to do?

The best advisors use what if scenarios. So talk about if you do this, then you can also do that. If you don't do this, you can't do that. And really looking at those trade offs and different paths that you could take and then explaining the recommendations clearly and connect them back to your goal, I can make a recommendation that you should invest in XYZ and you should put this amount in, but I have to connect it back to the why you should do this so that you can send your kid to college, retire in 20 years, whatever the case may be.

I would also ask to see a sample financial plan. That way you know if the plan is something that you would be able to understand, does it have the right level of detail for you? It is a is it in a presentation style that you can relate to, and then make sure that there's a review process. We talked about communication.

Make sure that they're going to review it in a timeline, like an ongoing manner that works for you. So make sure you're aligned there. And then most importantly, make sure that your advisor is including your partner, spouse, whoever else, is important in your decision making. They need to be a part of those conversations.

So I've had many clients who left advisors because that advisor only spoke to the spouse or only spoke to them. And if it's if you're planning as a team, that whole team needs to be part of that conversation.

Matt Spratt: A lot of fierce head nodding going on over here.

Emily Herstein: Yeah.

Matt Spratt: I would just to add on to what you said, Emily, I think I have the privilege of hiring a lot of advisors for our business. The thing that I look for first, in all of the advisors that I work with is care. I need to know if they care about the clients that they're working with. I think our listeners should look for the same thing.

Do they care about you as a human? If they don't care, then that's probably not going to be a good fit for you, because it's that care that does the extra due diligence that you may not see or that you may not hear. Right. Checking your beneficiaries, for example. That's a care step.

It's not a requirement of all advisors to do that, but if they care about you, they are going to do that. To your point earlier about your advisor saying that, you know, a will was a complicated or was something that you should be thinking about, right? That is demonstrating care for you. I doubt your advisor makes any money off of you getting a will, but what they do is hopefully put you in a better position and that is the demonstration of their care for you.

Jessica Sclafani: I feel very cared about.

In addition to care. Another word that comes to mind is trust. Trust is so obviously crucial in this relationship between an individual and their advisor. So how do you build and maintain trust?

Matt Spratt: It’s a great question. Trust is a hard one too, because it's so deeply related to what your values are and what the human that you are. And that's why I think Emily and I have spent so much time emphasizing that fit matters. I think trust comes from a lot of things, but I'll start with a few things that come to mind.

Transparency is a really big one. Transparency in things like we talked about earlier. Are you a fiduciary? What is your compensation look like? Are there conflicts of interests? Is there something that limits what your advisor can do? Right.

I always talk to my advisors about our clients don't expect us to know everything because it's not possible to know everything. This industry financial planning, investments, insurance, the whole thing. It's so massive it's impossible to know everything. What we should be doing is telling them what we know and giving them the best information we can, and also confidently telling them what we don't know and how we're going to address that.

That may be, hey, I'm going to go do research or that may be, hey, you're asking a really great estate planning question. I'm not an estate planning attorney. I don't have the information for that. But here are some things that you could consider in that question. That would be the right thing to ask an estate attorney.

Again, speeding up those billable hours for for that client, referencing them to somebody that can be trusted. I think it's also about understanding the communication that you're going to receive. Is it proactive? Is it reactive? Is it intentionally proactive or intentionally reactive? To Emily's point, if you want to meet with your client, your advisor on an annual basis, and they don't offer that, that may be a deal breaker.

If they don't send you, if you're expecting them to send you articles about current events, but they don't offer to do that, that might be a deal breaker for you. Maybe you don't want them to send you articles about current events because you just want to ignore it. That may be a deal breaker too. You may be getting spammed by this company.

Uh, so just understanding what the communication is, what your expectations should be for communication, and that should be clearly outlined upfront and then they should hold to that. I think it's also important to recognize that they should respect your values and your goals as an advisor, as a financial planner.

Our job is not to judge. Our job is to understand and help you understand what the implications of those values and things are. I don't care if my client wants to spend $100,000 a year on shoes. My job is not to judge whether or not that's a prudent financial decision. It's to help them understand if you do that.

These are the impacts to your financial plan. Now, that may result in a conversation about maybe we need to pare back the shoe budget a little bit.

Emily Herstein: But I will not be hiring you as my financial advisor then.

Jessica Sclafani: Then I was just going to say you lost a few people.

Matt Spratt: Yeah, I mean, balancing all things right. But it's not our job to judge, right? It's our job to help you understand what the impacts are of the plan. And I think that's important. And some I have heard stories from clients where they felt judged by whatever their goals were or whatever their values were. And I think that's an important aspect of the relationship as well.

Jessica Sclafani: And feeling judged, certainly. Does it lend itself to building trust over time?

Matt Spratt: No, not at all.

Jessica Sclafani: So we've talked about some things to look for in a financial advisor, some positive attributes. But I do think it's worthwhile for us to address some factors that could be potential warning signs. I know we alluded to a yellow flag earlier in our conversation, but maybe what are some red flags that people should watch out for as they're doing their search?

Matt Spratt: Yeah, I think there are definitely some red flags out there that we should be aware of. High-pressure sales tactics are one that make me uncomfortable personally. Having worked in this industry for a while, having worked with many different financial advisors, I've never asked in a financial advisor to do something that I wouldn't do myself.

I won't high-pressure anybody into making a decision. This is your nest egg. This is your this is your hard earned savings. Over time, if you're going to entrust me with it, that is a big responsibility. I shouldn't be pressuring you to make that decision faster. Guarantees of returns. This is another really hard one.

Most of the products that we all deal with don't come with guarantees. And the reason is, is because they operate inside of markets, and markets don't have guarantees associated with them. Understand that if you are getting a guarantee, there are products that offer guarantees. There are some insurance products that have those guarantees.

But understand that you're paying for that guarantee. You're paying for that certainty. So I would any financial professional who offers you a guarantee, I would be asking the question to understand what does that guarantee mean? I also encourage people not to be wooed by things like, I'm the top advisor in this this region.

I think that can be a good indicator of somebody who's really good. That can also be a really good indicator of somebody who is only churning through clients and doesn't actually take the time to circle back and do the continuous planning that Emily was talking about earlier. This one is really key to me pushing a product without understanding your personal situation and being able to tie it back to why it matters for you.

We talked a little bit earlier about sometimes there are conflicts of interest in the compensation that advisors receive. If they can't articulate to you why a particular strategy or product makes sense for your situation, it might not make sense for your situation. I talk to clients a lot about, you know, do you want the the most complex strategy or do you want a strategy that works for you? Because those things are often very different things.

Lack of proper licensing and registrations. We talked earlier, Emily mentioned earlier that FINRA self-regulatory organization inside of our industry that helps keep us all licensed has this BrokerCheck. It's a great website that you can go look at.

You should make sure that the advisor that you're working with is properly credentialed and properly licensed to make sure that they have the requisite knowledge. And I would stress that this is base knowledge, the requisite base knowledge to work in the industry. If they don't, that should be a red flag,

No clear succession plan or team structure. That is something that I worry about because it's pretty easy to get into the industry. You can sign up with a lot of different investment houses or a lot of different insurance houses and get into the industry pretty quickly. One of the things that I worry about in that is if you are just a one person shop and something unforeseen happens, you get sick. Something like that.

Is your financial plan in good standing, and do you know how to get access to it? In the event that your advisor does have something unforeseen happen? And if you don't, that might be a bad thing. It's one of the things I love about our our program is, you know, having the institution

carry the legacy of those plans forward means that even if something happens to one of our best advisors, I can always get access to the plan, and I can always make sure that there is a competent and capable advisor who can talk to the client, even if that, for example, is a new advisor to that client.

Emily Herstein: Yeah, those are great points. I’ll Maybe add a couple more. And I mentioned it before, but I would steer clear of one-size-fits-all recommendations. We are not all the same. All our needs are different. I've met people who have said my advisor uses XYZ for everybody and that that's not appropriate. It does, you know, regardless of age goals,

you know, risk preference. They put everybody in the same thing. And it's probably easier for the advisor to manage, but it's not the right thing for the client. So one-size-fits-all recommendations. That's really a red flag. You wouldn't want to go to a doctor. Again, back to the medical analogies. You wouldn't want to go to a doctor who puts everybody on the same medication, regardless of how old they are and what their, you know, personal health history is.

It just wouldn't make sense. It's the same for your financial health. Also, advisors who don't ask detailed questions about your goals, your risk tolerance, your financial situation. And don't try to get to know you because how can they make a good recommendation if they don't know all these things about you?

They are probably are doing the one-size-fits-all. They just see how much money you have. Put it in the market. That is not going to help you get where you want to go, and if it does, it's certainly not going to be a comfortable ride, right? You're going to have no, there's no thought put into it. And then communication styles that don't match your preferences.

We've talked about this a lot, but if you need frequent updates, a red flag would be somebody that isn't going to provide frequent updates and vice versa. Advisors who seem more interested in gathering assets. This is the biggest one for me than understanding your needs. That is a huge red flag. It should be about getting you to where you want to go, and not how much money you have and not how much money you invest with them.

It's really, how can I get you to retire if that's your goal, or to send your kids to college, or to do both of those things, or to get that vacation home, or pass enough money down to your to your heirs. It's not about how much money you have, it's about what they do with it. So I would remember that if you remember nothing else.

And then the last thing I'll mention is just to be wary of advisors who freak out or are discouraged by you getting a second opinion. If they're confident in what they do and how they can help you, they're not going to worry if you go seek somebody else out. If you guys connect, you connect, and if you don't, you don't.

And they should be. A red flag to me would be somebody who's not willing to kind of accept that if they say, well, I'm the best and I'm going to offer you this and you should go with me no matter what. That may all be true. But if you're not comfortable, if you don't mesh, it doesn't matter. And they should be okay with the fact that you may want to go somewhere else like that is okay.

There are enough clients around. There's enough money for all of us to invest that we can all stay employed as advisors. So if they are so worried about you wanting a second opinion, or you taking your business elsewhere because you don't click, then you made the right decision. They were not the one for you to be with anyway.

Jessica Sclafani: Well, thank you, Emily and Matt. I think you've listed several important warning signs to keep an eye out for as we wrap up our conversation today.

Emily, I'll start with you. What's your best advice for someone who's ready to take the next step and start building a relationship with a financial advisor?

Emily Herstein: Come prepared to your first meeting so you make the best use of your time. So come with your financial documents: bring statements, tax returns, but most importantly, clear questions and a list of your goals, even if they're not perfectly defined yet. Part of the role of the advisors to help you define them, but know kind of what you want to accomplish, at least on a very broad level.

And be honest about that. Be honest about any concerns that you have any fears. Past experiences, both positive and negative, with the financial advisor that you've had, because that can help your advisor shape how they do business with you going forward. And then don't feel pressured to make a decision immediately.

We talked about this a little bit, too, like, it's okay to take your time and know that going in, you know, remind yourself no matter what this advisor tells me, I do not need to sign up right now. Today, start with a specific project or limited engagement if you're unsure about committing a full relationship.

So maybe you begin with retirement planning and then see how that goes, and then open it up to a comprehensive relationship. It's okay to start small and build that trust, right? You don't always know right away. If you trust somebody you think you do, but you maybe want to test the waters a little bit, right?

You go on a first date, you don't get married the next day, you go on a date. Well, some people do that. That's a different podcast. But you go on a date, you get to know each other, and then you go on another date, right? Or you go to your doctor to talk about one thing. And then as you get to know them, you tell them about other maybe health concerns you have.

So same with the financial professional. Start with something. See where the relationship goes. That is perfectly okay. You may be somebody who wants to like go full on from the beginning. You have such a great trust. They you know where your parents advisor. And that's okay to start with a full relationship as well, but don't feel you have to.

Matt Spratt: Great points. I think to add to the conversation I would say, remember, it's a partnership. You should feel comfortable being an active participant in your financial planning. That's critical. We've talked about it a lot here. Comfort matters. The way that the advisor addresses you matters. Trust your instincts about the personal connection that you're building with these people and evaluate the professional right.

Do you feel comfortable? Do you do you feel like this is the best plan for you? I often talk to my advisors about being really clear about what they are and what they are not. And I think that marries that's the advisor side of it. Right. You have to be clear about what we can do for people and what we can't do for people.

I think the client side of that is don't try to make your advisor into a professional that they're not. You can ask them great questions. They will give you insight, and they should be able to point you in the right directions if it is not their expertise. But don't try to make an investment advisor and an estate planning lawyer that doesn't.

That usually doesn't lead to the best estate plan for you. Be prepared for the relationship to evolve over time as your needs change, and as your trust builds with these advisors. Sometimes to Emily's point, that means deepening your relationship and saying, okay, you've earned my trust. I'm happy to to have a full, comprehensive relationship with you.

Sometimes that evolves because your needs evolve and that's okay. It's okay that your relationships evolve. Don't be afraid to ask for what you need. Remember that this is not about the advisor, it's about you. I'm a firm believer that your advisor should be a personable individual, and should share things about themselves with you so that you know a little bit about the human that you're working with so that they're a real person to you.

But it's not about them. It's about you and your finances, your your plan and making sure that you can execute on those things. And then I think the last thing I would say is, don't go for complexity for complexity’s sake. Just because you have a really complex plan doesn't mean it's the best plan. To Emily's point, make sure that when you're looking at these plans that you can understand what's going on and that you can execute against them.

Complexity can lead to better results in some ways, but if you can't execute or don't understand that complexity, it's not going to lead you to the outcome that you're looking for.

Jessica Sclafani: Thank you both for sharing such practical and valuable insights about finding the right financial advisor. This is truly one of the most important relationships you can build for your financial future.

For our listeners, remember that the right advisor should make you feel more confident about your financial decisions, not more confused or pressured. Take your time. Ask the right questions and trust both your head and your heart in making this important decision.

Again, I'm Jessica Sclafani. Thank you for listening. Please tune in to our next episode, where we'll discuss how global diversification helps manage risk and capture opportunity. If you like this podcast and I know you do, please rate us and subscribe wherever you get your podcasts. And remember, the numbers matter.

But so does knowing you have the freedom to live with purpose and peace of mind.

T. Rowe Price

Retire With Confidence

This episode of Confident Conversations on Retirement is provided for general and educational purposes only, and is not intended to provide legal, tax, or investment advice. This podcast does not provide recommendations concerning investments, investment strategies, or account types. It is not individualized to the needs of any specific investor and is not intended to suggest any particular investment action is appropriate for you, nor is it intended to serve as the primary basis for investment decision-making. Investors will need to consider their own circumstances before making an investment decision.

All investments involve risk, including possible loss of principal.

The views contained herein are as of the date noted on the material and are subject to change without notice. These views may differ from those of other T. Rowe Price group companies and/or associates.

©2026 T. Rowe Price. All rights reserved. T. Rowe Price, INVEST WITH CONFIDENCE, RETIRE WITH CONFIDENCE, the Bighorn Sheep design, and Confident Conversations, collectively and/or apart, are trademarks of T. Rowe Price Group, Inc. All rights reserved.

T. Rowe Price Investment Services, Inc., distributor. T. Rowe Price Associates, Inc., investment advisor.

202606-5568037