At Hill Investment Group, we love to ask questions – to get to know you upon initial meeting and discover more about you as we go. But what questions should investors be asking? Here are “The 19 Questions to Ask Your Financial Advisor” (or a prospective advisor) according to Jason Zweig of The Wall Street Journal. At the highest level, these 19 questions seek to establish the rhetorical question: Are you paying your advisor to serve YOUR best interests or their own?
“The obligation of those who give investment advice to serve clients, not themselves, is called fiduciary duty. That obligation is far from universal and, in some ways, is in retreat,” says Zweig (emphasis ours).
The challenge, however, is merely asking an advisor if they are a fiduciary may not suffice. Zweig’s queries will help you differentiate fake fiduciary “talk” from a real fiduciary “walk.”
Zweig also provides the answers he feels are most appropriate, while leaving #12 (“What is your investment philosophy?”) curiously blank. We agree wholeheartedly with nearly all of his suggested responses, although there are a couple we would qualify. And of course we have quite a lot to say about that curiously blank one. Here, we’ll simply add the words of Dimensional Fund Advisors’ co-founder Rex Sinquefield, as he describes evidence-based investing: “This investment approach is easy to communicate, is verifiable, and is eminently defensible.”
This and many other great insights are found in Dimensional’s recently published “35 Quotations on a Better Way to Invest.” Want a copy of it, or would you like to know where else we differ on Zweig’s other questions (and why)? Just ask!
Oh, by the way, YES, we are a fiduciary firm – in name and practice.