Top Five Questions to Ask Professional Advisors, Before you Hire

I was sitting with a colleague last week, chatting about a range of things: the economy, is the administration’s Stimulus Package truly stimulating (or is it a handout), and how small business owners can protect themselves.

Our conversation then moved to “whom can you trust?”

Two heads are always better than one. Many businesses (large and small) use this principle to their advantage to add to the intellectual wealth of their companies. In exchange, you can benefit from guidance, expertise, experience, and network connections of carefully selected advisors.

With the seemingly pervasive attitude of fear, how can business owners protect themselves in areas where they might not have enough experience (e.g. financial planning, accounting and the law)? How can you feel more comfortable trusting those professional specialists?

For starters, we came up with a list of “top five” questions to ask those who will eventually become an integral part of your trusted advisory team.

When choosing a Financial Planner don’t forget to ask:

1. What does the term “financial planner” mean to you? What will you be doing for me? Will you manage and/or invest my money, write a plan, set goals and sell insurance? Or some combination of the above?

2. What is the percentage breakdown of your own income? How much comes from money management fees, plan creation fees and selling insurance?

3. How can you help me create a lifestyle for myself and my future? How can you help me take the money I accumulate from my business and turn it into an income I can live on?

4. How will you help me protect what we put together? What will you and I do to protect against the effects of inflation, market downturns, disability, prolonged illnesses and more dependents (e.g. caring for my parents or siblings)?

5. Tell me a story: How were you able to help someone in a similar circumstance to mine?

When choosing an Accountant don’t forget to ask:

1. How will you act as my financial advisor? Will you simply file my business taxes or is there more you will do?

2. How can you help my company meet its financial and tax goals?

3. Can you help me determine the profitability and feasibility of major financial decisions, such as buying business equipment, a merger/acquisition or expansion?

4. What is your background and experience with companies in my industry; with my revenue levels and the unique issues my company is facing?

5. Do you have a certified professional accountant (CPA) designation, and will that be important for the kind of work I will need done?