When considering a financial planner, always ask for and review their Form ADV 2A and 2B. These regulated documents make important disclosures about fees, refund policies, conflicts of interests, and any prior history of disciplinary actions. Investment advisors are required to provide this document to clients at least 48 hours prior to signing a contract and at least once annually; we feel they should be publicly available long before that. General tips for reviewing:
For Form ADV 2A – It’s all important, but pay particular attention to Item 5 (Fees, Refunds), Item 9 (History of disciplinary actions), and Item 14 (Other Compensation – this can highlight potential financial conflicts of interests).
Form ADV 2B – Much shorter supplement covering an individual investment advisor that reports educational background, business experience, conflicts of interest, and disciplinary history of individual planners.