7 Worst Mistakes People Make When Choosing a Financial Advisor

When you have $1 million or more invested, mistakes get expensive, and every choice has a bigger impact on your bottom line.

A recent analysis found that investors who work with a financial advisor could more than double their net worth compared to managing money on their own. The takeaway: having an advisor can make a huge difference.

Based on a valuation model from smartasset.com, this example projects the final net worth of someone starting with $500,000 at age 45 and investing through age 77. Factoring in returns, taxes, and inflation, the outcome is ~$3.24M with an advisor vs. ~$1.56M without. Estimates are illustrative and will vary by individual circumstances.

If you don't have an advisor yet, here's a quick quiz you use to find a great advisor in your area.

All advisors matched through this free quiz serve your local area and are fiduciaries — which means they’re legally required to act in your best interest. Many offer a free initial consultation.

Here are 7 mistakes to avoid when choosing a financial advisor.

1. Working with an advisor who isn't a fiduciary

A fiduciary is someone who is legally and ethically required to put their client’s best interests first. Fiduciary financial advisors must steer clear of conflicts of interest and are required to openly share any potential conflicts with you. Here is a free tool to help match you with an advisor who has been properly registered or certified.

2. Going with the first advisor you find

It’s easy to rush and choose the nearest or first advisor you find, but it’s worth taking the time to meet with a few before deciding. This free quiz can match you with fiduciary advisors so you can compare and choose the right fit.

3. Picking an advisor who doesn't specialize in your needs

Some advisors focus on retirement, others on wealth management, and some work best with young professionals or small business owners.

Make sure your advisor’s expertise aligns with your life stage and goals.

4. Working with an advisor who doesn’t match your style

Every advisor has their own approach. Some take bigger risks, some are conservative. If you’re risk-averse, you probably don’t want an advisor who pushes high-risk and aggressive investments.

This free quiz helps you clarify your preferences and start that conversation with an advisor.

5. Skipping the credentials check

Always ask about an advisor’s licenses, certifications, and exams. Credentials matter. Advisors must be properly qualified to give investment advice.

6. Not understanding their fee structure

Advisors can be paid in different ways — flat fees, a percentage of assets, or commissions. Some commission-based advisors may recommend products that aren’t in your best interest.

Working with a fiduciary helps avoid some of these pitfalls, but you should always understand exactly how your advisor is compensated.

7. Failing to choose a vetted advisor

There are plenty of well-qualified fiduciary advisors out there, but it can be hard to know who to trust.

This free quiz simplifies this process by connecting you with carefully vetted advisors who meet particular standards and serve your area.

An advisor who isn’t a fiduciary might recommend choices that don’t put your best interests first.

Discover local financial advisors near you.

Nothing on BillChecker should be taken as an offer to buy or sell securities. Investing always carries risk, including the risk of losing money. Working with an adviser may also mean paying fees, which can reduce returns. Results are never guaranteed — past performance doesn’t predict future outcomes, and even fiduciary advisors can face conflicts of interest.

BillChecker does not give legal, tax, accounting, or personalized financial advice. Our role is to connect users with independent fiduciary advisors in the United States who participate in a platform. The content we share is meant for general information only, not tailored recommendations. For advice specific to your situation, please speak with a qualified tax professional, attorney, or accountant.

Advisers on this platform may compensate BillChecker for referrals. We don’t review or monitor their ongoing performance, manage accounts, or provide investment recommendations.

BillChecker does not hold assets or manage funds. We exist solely to help users find and connect with financial advisers.