Picking the right investment advisor is a difficult process. You have to ask the right questions in order to make sure you are finding one that fits all of your needs.

1. Do you currently serve as an advisor for company retirement plans?

It is important to know if the advisor you are looking for has experience and is currently working in the industry. Some follow-up questions may include:

  • What kind of plans do you work with?
  • What percentage of your practice is focused on advising company retirement plans vs. individual wealth advising?
  • How many plans do you advise?
  • What professional groups are you associated with?
  • Have you obtained any credentials or certifications related to the retirement plan industry?
  • Do you participate in continuing education courses?
2. How are you compensated?

You want to make sure all costs are disclosed upfront before you begin working with your investment advisor. Be sure to identify any and all direct and indirect compensation charged and/or received by the investment advisor, including fees that are deducted from plan investments and assessed against a portfolio’s assets. You should also find out if the investment advisor you are interviewing accepts any 12b-1, sub-TA or any other type of referral fee from any vendor.

3. How do you select the investments you recommend?

Be sure to ask why the investment advisor you are interviewing thinks their selection process works, and how it will work for your company.

4. What is your process for developing and recommending an Investment Policy Statement (IPS) for our organization?

An IPS is a written policy used as a guideline for investment decisions by the plan’s fiduciaries.

5. What are some plan design features that you often recommend to your clients and why?

It is recommended that you gain an understanding of what types of plan design features your advisor recommends to clients, so you have a better idea of what they may offer to you.

Automatic enrollment is often recommended by investment advisors as a way to get your employees to start using the retirement plan and saving.

6. Do you have a team to support our employee’s retirement plan questions and needs?

You want to make sure that you will have the support that you need. Be sure to ask the advisor to describe what kind of support they provide, including:

  • Support at the plan sponsor level
  • Support at the plan participant level
  • Enrollment support
  • Any other education
7. How do you keep up to date on regulations and trends affecting company retirement plans?

The retirement plan industry is highly regulated and requirements frequently change. It is important your investment advisor has a process for keeping up to date on what they should and need to know about the regulations.


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