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What needs do your clients typically have in common? How can you help me achieve my goals? How will you track and report my progress? Do you provide a checklist that I can use to monitor the implementation of any financial plan we develop?

How do you choose investments? What investing approach do you believe is most successful, and what evidence can you show me that you have achieved that kind of success for your clients? What do you do when an investment performs poorly for an entire year? (Any adviser who answers “sell” is not worth hiring.)

Do you, when recommending investments, accept any form of compensation from any third party? Why or why not? Under which circumstances? How much, in actual dollars, do you estimate I would pay for your services the first year? What would make that number go up or down over time? (If fees will consume more than 1% of your assets annually, you should probably shop for another adviser.6 )

How many clients do you have, and how often do you communicate with them? What has been your proudest achievement for a client? What characteristics do your favorite clients share? What’s the worst experience you’ve had with a client, and how did you resolve it? What determines whether a client speaks to you or to your support staff? How long do clients typically stay with you?

Can I see a sample account statement? (If you can’t understand it, ask the adviser to explain it. If you can’t understand his explanation, he’s not right for you.)

Do you consider yourself financially successful? Why? How do you define financial success?

How high an average annual return do you think is feasible on my investments? (Anything over 8% to 10% is unrealistic.)

Will you provide me with your résumé, your Form ADV, and at least three references? (If the adviser or his firm is required to file an ADV, and he will not provide you a copy, get up and leave—and keep one hand on your wallet as you go.)

Have you ever had a formal complaint filed against you? Why did the last client who fired you do so?

Defeating Your Own Worst Enemy

Finally, bear in mind that great financial advisers do not grow on trees. Often, the best already have as many clients as they can handle—and may be willing to take you on only if you seem like a good match. So they will ask you some tough questions as well, which might include:

Why do you feel you need a financial adviser?

What are your long-term goals?

What has been your greatest frustration in dealing with other advisers (including yourself)?

Do you have a budget? Do you live within your means? What percentage of your assets do you spend each year?

When we look back a year from now, what will I need to have accomplished in order for you to be happy with your progress?

How do you handle conflicts or disagreements?

How did you respond emotionally to the bear market that began in 2000?

What are your worst financial fears? Your greatest financial hopes?

What rate of return on your investments do you consider reasonable? (Base your answer on Chapter 3.)

An adviser who doesn’t ask questions like these—and who does not show enough interest in you to sense intuitively what other questions you consider to be the right ones—is not a good fit.

Above all else, you should trust your adviser enough to permit him or her to protect you from your worst enemy—yourself. “You hire an adviser,” explains commentator Nick Murray, “not to manage money but to manage you.”

“If the adviser is a line of defense between you and your worst impulsive tendencies,” says financial-planning analyst Robert Veres, “then he or she should have systems in place that will help the two of you control them.” Among those systems:

a comprehensive financial plan that outlines how you will earn, save, spend, borrow, and invest your money;

an investment policy statement that spells out your fundamental approach to investing;

an asset-allocation plan that details how much money you will keep in different investment categories.

These are the building blocks on which good financial