5 Insightful Questions to Ask your Financial Advisor

Posted 25 March, 2018 by Surely
in Educate Yourself

Are financial advisors our friend or our foe? We would like to believe that they are our friends. But the truth is, not all financial advisors can claim to be one. There are black sheeps among them that act in their own interest, and not to the best of our interest.



Here, the term “frenemy”.


But having a financial advisor is often the first step towards financial freedom, especially if you aren’t financially savvy. For those of you who are interested in engaging a financial advisor (or have already engaged one), here are five insightful questions you must ask your financial advisor.


Question 1: If I Could Only Own 1 Insurance Product, What Should That Be?


A financial advisor who looks out for his own interest wants to sell you every single product in his inventory – Integrated Shield, Whole Life, Critical Illness, etc. It is unlikely that you would need all of them. A responsible consultant will only recommend plans that fit your needs. So, here’s what you should do – pose this question to him. There are two objectives that you want to achieve with this question.

The first is to gauge whether your financial advisor is acting as your fiduciary, i.e. taking due care of you as a client. If your financial advisor is recommending you to buy an Investment-Linked Policy (ILP), it is unlikely he is acting as a trustworthy fiduciary.

The second is to understand which part of your financial plan is lacking the right protection. An honest and capable financial advisor would recommend a product that addresses the most pressing coverage concern. He has to inspect your current portfolio, analyse your gaps and present the most effective solution, instead of running through his standard playbook.


Passing the ball to number 10 is our one and only play.

Nevermind the opponents. Passing the ball to the star player is our one and only strat.


No single insurance product can protect you effectively but this question will reveal the true inclinations of your advisor.


Question 2: Tell Me What Are The Sore Points About This Product You Recommend


We like to hear the good side of things. The moment we hear something bad, we get triggered and start activating our “self-defence” mechanism. The same happens when we hear bad things about an insurance product from our financial advisor. All financial advisors know that too and thus, they focus on the positive sides of things when making their sale pitches.

The differentiating factor is how aware your financial advisor are of the downsides of the products that he is recommending. He has to know the exclusions, how the plan fares against others in the market as well as the sales charges when it comes to ILP. He must be able to tell you that projected returns may not be guaranteed and that premiums may increase depending on age and claim experience for certain policies.


We really like nein-sayers.

We really like nein-sayers.


This question is no different from being asked about your weakness during a job interview. No sane person will volunteer his or his product’s shortcoming. However, a well-prepared agent is able to provide an objective assessment of his recommended products. He is entirely confident of pointing out the flaws because he understands that there is no perfect policy out there and that his solution is the most suitable one for you.


Question 3: What Insurance Products Have You Bought For Yourself?


Action speaks louder than words. If your financial advisor is preaching seemingly amazing financial products to you, just ask him a simple question: Ask him whether he has bought the same products for himself. If the product is as wonderful as he portrays it to be, it is unlikely that he will let the opportunity to buy it slip through his fingers.

Any insurance veteran that is worth his salt can rattle off model answers that they have honed through past conversations with their clients. It is the follow-up questions that may stump some – Why did he buy the plan and how does it fit into his financial goals?

Is Your Financial Advisor Walking The Talk?

The truth is whether he buys it is not important. What you should be looking out for is how congruent his answers are. Did he tell you that this policy is great for protecting your family previously but when it comes to his situation, the policy is targeted at singles?

By comparing notes, you can tell whether he is giving you genuine answers or merely fluff.


Question 4: Explain How Does This Plan Fit My Financial Goals


Every one of us has goals in life. For most, our goals revolve around fiscal stability and financial needs. That is why finding the right advisor that can help achieve these goals is important. The right financial advisor will help us understand our current financial situation and help us create a balanced plan to meet our life goals.

Good Financial Planning is not about finding the best products but the ones that are tailored to your goals


The importance of a tailored suit as demostrated by a Kingsman.

The importance of a tailored suit as demonstrated by a Kingsman.


Given that each of us has different goals in life, it is natural that there isn’t a one-size-fits-all kind of insurance plan. No one knows what you want better than yourself but you may not know the best path to take.

A good financial planner is able to point you in the right direction so that you may reach your goals with greater ease. By giving his rationale behind his recommendations, you are in a better position to judge if he is planning for your goals or towards his own MDRT aspirations.


Question 5: What Are The Key Assumptions You Made In Proposing A Financial Plan To Me?



Unless you spend all week long with your financial advisor, it is likely that he has to make certain assumptions on your behalf. Some assumptions are definitely right – you will like to pay less for more. Others may be less universal – not everyone wants to create a university fund for their children. That is why you need to question the key assumptions that your financial planner has made.

The Wrong Assumptions Can Ruin Your Entire Financial Game Plan.

If your financial advisor assumes that you only need a minimalist $1,000 per month upon retirement but what you really want is a cool $3,000, you are in deep trouble. You would have wasted precious time on a conservative approach and missed out a few vital years of interest compounding.

Never assume that your consultant is assuming the same as you.


Ending Note


There is a misconception that as a customer, all you have to do is to lean back and wait for the perfect solution. That is never going to work out well.

Open, clear and honest communication is absolutely vital to successful financial planning. A great financial planner never gets sick of your questions. These questions can only help him to understand you better which in turn allow him to formulate the perfect plan for you.

Fire these questions away and may your financial advisor lead you to the bull’s eye!

www.ClearlySurely.com aims to eradicate the knowledge gap between consumers and Life Insurance. Our Vision is that one day, every Man, Woman, and Child will be properly insured.

Do you have some really embarrassing questions for your financial planner? Find out why you should never be too paiseh to ask them!

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