As your business or your financial situation expand, you’ll need to start hiring professional help — like a CPA, an attorney, an insurance agent, and maybe a financial planner. But where do you find the right professionals to put on your team?
We not only share how to determine the right type of professional you need to add to your team, but where to find them.
Start With Your Peers
When looking for financial professionals to work with, people often start by asking those closest to them — friends, extended family, coworkers, neighbors, and even acquaintances. But while these people may be close to you on a personal level, they may not be actual peers, at least not in a business or financial sense.
When I say peers, I mean people who are in similar financial circumstances just like you. For example, if you run a business, you’ll want recommendations from people who are engaged in similar businesses. A CPA may be an excellent accountant, but if you’re running a web development business and he has no similar clients, he probably won’t be the right accountant for you.
The same is true with an insurance agent. The insurance agent who handles your parent’s policies may have very little experience in providing business insurance policies, particularly for the type of business you run. If this is the case, you could end up with all the wrong coverage.
So in looking for financial professionals, get recommendations from people whose business and financial circumstances most closely match yours. Not only will it help you find the right professionals, but it will also cut down on the weeding-out process.
Check With Licensing Bureaus and Other Third Party Sources
Once you locate a professional, your next step should be to check their professional credentials with the relevant licensing agencies in your state. Here are some places you can begin investigating the various professionals you may need:
- CPAs — You’ll want to check with the state board of accountancy.
- Lawyers — Check with the state bar association, or even the state or local courts.
- Insurance agents — Typically, you’ll want to check with the state insurance commissioner.
- Financial planner — The licensing authority may go by different names in different states, so you may need to check the state‘s general website as a starting point. You can also go to the CFP Board, which offers licensing and bankruptcy information on financial planners in each state.
When you check out a professional through a licensing bureau, you’re not just looking to determine whether or not they’re properly licensed. More specifically, you want to determine if there have been any disciplinary actions taken against them. This can include everything from very minor infractions, to more serious ones that may affect whether or not you decide to use them at all.
Apart from the state licensing bureaus, you should also check out the local chapter of the Better Business Bureau, as well as the local department of consumer affairs. These sources may reveal customer complaints that did not rise to the level of disciplinary action by the state authorities. A complaint here and there is generally not cause for concern, but a pattern of complaints should cause you to think twice.
And for what it’s worth, you should also do a web search on this professional, using both his or her personal name, as well as the business name he or she operates under. You may be surprised at the scuttlebutt that shows up just by doing a general web search.
Interview Them to Make Sure it’s a Good Fit
Even once you’ve gotten referrals, and checked out the professional in the usual places, there’s one more thing you need to do — conduct an interview. Your relationship with a financial professional will be a very close one, and you have to make sure the two of you connect.
Set up a lunch meeting, offering to buy the professional lunch — or better yet, have them buy you lunch. After all, you’re a prospective client, and they’ll at least get a tax deduction out of the cost of the meal.
During your meeting, you should be looking for the following:
Make sure the personal “fit” is there. No matter what the professional’s qualifications are, or how well recommended they may come, if the two of you don’t have a personal connection the arrangement may never work. You’ll be relying on this person to provide information regarding critical decisions for your business and personal finances, so you have to be comfortable with the relationship.
Test his or her knowledge. Much like a job interview, you want to determine exactly what the professional knows, particularly as it relates to your specific circumstances. This is a good time to throw out specific scenarios you are facing or considering. Listen to the answers provided — does the information seem particularly relevant to your situation? Does it solve a problem? If not, and the answers seem too generic, this professional’s depth of knowledge may be lacking.
Make sure he or she knows your niche. We already touched on this point, but it’s worth revisiting. The professional should have specific knowledge of your business or financial situation. If not, he or she may not be adequately prepared to provide relevant answers and solutions.
Don’t be Afraid to Find a New Teammate
One final piece of advice: even though you do all of your homework in selecting the right financial professionals, the relationship might still be unsatisfactory. This is an outcome you should be prepared to deal with. This means ending the relationship if it isn’t meeting your needs.
Many people continue working with certain financial professionals, either because they came highly recommended, are locally popular, or feel they are already too entangled to leave. Nonsense! If the arrangement isn’t working, it’s best to end it, and to do so as quickly as possible.
Poor or irrelevant financial advice or strategies can cost you money and even put your entire business in jeopardy. It’s never something you can afford to take lightly.
Remember, the financial professional is working for you — not the other way around. Be prepared to move on if you sense the relationship is not working on any significant level.