In my role as the Senior Wealth Concierge at WealthFactor, and through my years of client services experience, I’ve come across many instances where clients or potential clients are vetting financial advisors, for one reason or another.
At WealthFactor we recommend working through these due diligence steps.
The first place you should start is online with a deep dive into the following areas, looking for potential red flags.
Review of Filings
While visiting a firm's website and talking with team members is part of the process, we subscribe to the idea that one should trust, but verify. Investment services are highly regulated and as such there are excellent public resources to aid due diligence.
The Securities and Exchange Commission (SEC), the primary regulatory body, provides an online resource called the Investment Advisor Public Disclosure website. This site makes public the information that investment firms and advisors are required to report to the SEC regarding the underlying structure of their business and how they manage client assets.
You’ll find three reports on this site:
Additionally, if they are affiliated with a broker dealer you may also want to consult with BrokerCheck - generally, we recommend crossing anyone off your list that does have a broker dealer affiliation.
Reviewing these reports can be a little overwhelming, so at WealthFactor, we recommend you review and consider the following in a firm’s filings:
Now, you may have gleaned from the filings on a firm that there aren’t any red flags and that’s great news. But, there’s one final step you should take now that you’ve done this due diligence. And I highly recommend that you do… interview the advisor you are considering!
Additionally, whether through interview or the firm’s website, the following elements should also be considered:
Arming yourself with the most accurate information possible when vetting an advisor or firm is smart. Don’t take a recommendation as a done deal, until you’ve done your homework.
At WealthFactor, we’ve built our business on the principles of simplicity, accessibility, and transparency, proven by our openness about our own filings and exercised each day by how we utilize technology and real subject matter experts to help you manage your wealth well.
Here are other Insights pieces that showcase how WealthFactor is unique:
As the Senior Wealth Concierge, I'm always here to answer questions and connect you with the expert that's right for you. Learn more about my role and reach out with any concerns.
- Brie Valant, Head of Concierge Services and Senior Wealth Concierge @ WealthFactor
Schedule a time to talk with Patrick and meet our team of Wealth Experts.