Vetted Wealth · Choosing an Advisor

Questions to ask before you trust an advisor

You do not need to know finance to protect yourself in the first meeting. You need a handful of plain questions and the patience to wait for plain answers. Here they are, grouped by the five things that actually matter, with what a straight answer and an evasive one tend to sound like.

Choosing an advisor · about 6 minutes

The five things to settle

Every question below maps to one of five checks. If you remember nothing else, remember these.

Role, fee, proof, money flow, exit. Settle these five, in writing, and most mistakes are already behind you.

1. Role: what job are you doing for me?

"Are you advising me, or selling me a product? Which one?"

Advice, distribution, execution and money management are different jobs with different duties. A seller is not on the hook to act in your interest the way a fee-only adviser is.

Good answer: a clear statement, for example "I am a fee-only adviser" or "I am a distributor and earn commission."

Evasive answer: "I do a bit of everything" or "I'm your wealth manager," without naming the actual role.

2. Fee: how do you get paid?

"How exactly are you paid, and does your income change depending on what I buy?"

This single answer tells you which way the advice leans. If their pay rises when you buy a particular product, you are getting a recommendation with a stake in it.

Good answer: a specific number or model, "a flat fee of X," or "a commission of roughly Y percent on this product."

Evasive answer: "Don't worry, there's no cost to you," which usually means the cost is hidden in the product.

3. Proof: what are you registered as?

"What is your exact registration, and what is your number?"

Distributor, broker and adviser are separate registrations. The title on the card is not proof. The number is.

Good answer: a category and a number you can check, for example a SEBI RIA number or an AMFI ARN.

Evasive answer: "We are fully SEBI registered" with no specifics. Verify any answer on the official register.

4. Money flow: where does my money actually go?

"Who receives my money, who holds the asset, in whose name, and what proves I own it?"

This is the question that protects you from outright loss. Your money and assets should sit in your own name with a regulated custodian, never in the adviser's personal control.

Good answer: money goes to a regulated entity, the asset is held in your name, and you get a statement that proves it.

Evasive answer: "Just transfer it to me and I'll manage it," or a request for your login or OTP. Walk away. See where your money goes.

5. Exit: how do I get out?

"What is the lock-in, the exit load, and what would I actually get back if I left in a year?"

"You can exit anytime" is often untrue. The cost and difficulty of leaving is as important as the pitch to get in.

Good answer: clear written exit terms, lock-in period, any load or surrender charge, and the tax.

Evasive answer: vague reassurance, or "why would you want to leave?" See exit and lock-in.

One more, the most revealing of all

"What is the downside, or the catch, that you have not told me?"

A trustworthy professional can name the risks and the conflicts in their own offer. Someone who insists there is no downside is either not thinking, or not telling you.

Good answer: an honest account of the risks, the costs, and where their interest and yours differ.

Evasive answer: "There's no catch, it's a win-win." Everything has a catch. The honest ones will tell you what theirs is.

You are not interrogating anyone. You are simply asking a professional to say plainly what they do and how they are paid.

A good one answers all of this without flinching, often before you ask. The discomfort an evasive answer creates is itself the information. Get the answers in writing, take your time, and trust the ones who make the answers easy.

This guide is educational and general. It is not advice on any specific person or situation. The questions here are a starting point for your own judgement, not a substitute for it.

Vetted Wealth