12 Critical (But Rarely Asked) Questions to Ask Before Trusting a Financial Advisor With Your Retirement
Most “get-to-know-you” meetings focus on surface-level topics: fees, fiduciary status, investment philosophy. Those matter…but they don’t tell you whether the advisor is actually an expert in retirement income planning, which is far more complex than general wealth management.
Below are the questions sophisticated clients and industry insiders rely on to separate true retirement specialists from generalists and product-pushers. Each one includes the hallmarks of a good answer and the red flags that should make you think twice.
1. “Walk me through every way you and your firm are compensated on my accounts.”
Good answer: A one-page breakdown showing AUM fees, platform/custodian revenue sharing, trailing commissions, and insurance overrides, all totaled clearly.
Red flag: Vague claims like “fee-only” followed by surprise 12b-1 fees or annuity trails.
2. “How do you address sequence-of-returns risk? How often do you re-run Monte Carlo simulations, and what probability of success do you require?”
Good answer: Annual Monte Carlo reviews + after any ±15–20% market move. Targets 90–95% success through age 95–100.
Red flag: Reliance on the 4% rule alone or unfamiliarity with Monte Carlo.
3. “Do you use fixed inflation-adjusted withdrawals or a flexible system (guardrails/dynamic spending)?”
Good answer: Prefers guardrails or dynamic spending, which can increase sustainable income by 15–30% while reducing depletion risk.
Red flag: Doesn’t recognize “guardrails” or insists 4% works for everyone.
4. “What’s your process for annual withdrawal sourcing and Roth conversion planning?”
Good answer: Models 25–30 years of taxes under current law and higher-tax scenarios; executes conversions to the top of the 22%/24% bracket or IRMAA threshold when optimal.
Red flag: “We’ll think about conversions later” or pushing it entirely to the CPA.
5. “How do you incorporate RMDs and Medicare IRMAA surcharges into the plan?”
Good answer: Explicitly models both 8–10 years before RMD age and uses phased conversions or QCDs to reduce future tax/IRMAA impacts.
Red flag: Doesn’t know what IRMAA is.
6. “If something happened to you, who exactly takes over my plan? Can I meet them?”
Good answer: Immediate introduction to the named successor advisor or service team.
Red flag: “The firm will handle it” with no specific person.
7. “Can you share an anonymized example of when you kept a client from selling at a market bottom?”
Good answer: A real story with dates, the portfolio decline, and the recovery outcome.
Red flag: “That never happens with our clients” or vague platitudes.
8. “How are you planning and funding your own retirement?”
Good answer: Has a written plan, uses the same principles they recommend, and follows realistic assumptions.
Red flag: No personal plan or “I’ll never retire.”
9. “When was the last time you told a client their spending wasn’t sustainable — and what happened next?”
Good answer: A recent example showing how they handled the conversation and adjusted the plan successfully.
Red flag: Claims they’ve never had to do this.
10. “Do your projections assume today’s low tax rates continue, or do you stress-test higher rates?”
Good answer: Runs a base case at today’s rates and a stress case with rates 30–50% higher.
Red flag: “Taxes will probably stay low or that’s a question for your CPA”
11. “Will I have daily, transparent access to my holdings, cost basis, and true net-of-all-fees performance?”
Good answer: Direct login credentials to a major custodian (Schwab, Fidelity, Pershing) with real-time data.
Red flag: Only quarterly reports or a proprietary portal with limited transparency.
12. “What’s your philosophy on retirement income: safety-first, total-return, or a hybrid, and why?”
Good answer: Can clearly articulate the approach, the research behind it, and which client profiles fit each method.
Red flag: “We just do what everyone else does” or pushing one product-centric solution (e.g., “We put everyone in annuities”).
Bottom Line
If an advisor can answer at least 10 of these questions confidently, with specifics and documentation, you’ve likely found a top-tier retirement planner. If they struggle with four or more, keep looking — your retirement income, tax strategy, and peace of mind depend on getting this right.