Investing Fundamentals

How to Interview and Hire a Financial Team

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financial team

You can DIY a lot of your financial life, but sometimes you need some help. But you only want to choose the best people when it comes to your money. Today we’re discussing how to interview and hire a financial team.

Shannon McLay from Financial Gym is our guest today. Financial Gym provides one on one personal training to help people achieve their financial goals.

Don’t Be Afraid to Ask

At LMM, we always tell you that you can handle your money on your own and that no one will care more about your money than you do. If you can master Mint, Betterment and Turbo Tax, you can mostly DIY it.

Even nerds need other nerds.

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There are some circumstances where you need to find some outside help. When that happens, you have to hire a financial team. Who should be a part of your team and how do you know a good member from a bad one?

Drafting Your Team

Not everyone needs all of the team members listed below. Depending on your circumstances, you might need none or all of them.

Accountants, Who Needs Em?

If you are a W2 employee, you don’t need an accountant. You need a bottle of wine and Turbo Tax. If you are self-employed, or have not filed a tax return for the past year or years, or have had significant life changes in the past year, gotten married, had a kid or gotten divorced, you might need an accountant.

Or CPA’s?

A standard accountant cannot represent you before the IRS, so if you have to deal with that particular body, you need a CPA. If a person who acts as their own attorney in a courtroom has a fool for a client, a person trying to deal with the IRS alone is equally foolish.


Most of us don’t need to hire a lawyer either. You can do a lot of simple things like basic estate planning, wills, and trusts, and assign power of attorney through Legal Zoom. You may have to have the documents certified locally, but for basic stuff, you don’t need an attorney.

If you have a lot of assets or complicated family relationships, you may need to hire an attorney to handle your estate planning, but most of us can do the basics on our own with Legal Zoom.

Financial Advisors

This person is the quarterback of your team. They call the plays. As such, they have to be doing a lot more than just “managing” your money. This person doesn’t work for free, so if they are only handling one aspect of your financial picture, you’re wasting your money.

Actively managed funds almost never beat the market. If you want your investments to make money, the important thing isn’t to have a financial advisor; it’s 90% asset allocation and 10% what kind of assets are in your portfolio.

“Active funds stumbled through another brutal year, with barely 1 in 3 large-cap managers able to beat the S&P 500, according to figures released Wednesday by S&P Dow Jones Indices. The news got worse farther down the scale, with 89.4 percent of mid-cap managers falling short and 85.5 percent of small-cap managers missing.”

A good advisor does a lot more than manage your money though. They help you create a financial plan and adjust it when you have significant life changes happen. Your advisor will help you stay on track with your financial goals. He or she can also serve as a tie-breaker between you and your spouse.

Financial disagreements cause a lot of divorces and a lot more fights. An advisor can act as a neutral party to help you and your spouse come to an agreement.

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How do you find a good team member? You can’t just open up the phone book (well, Google. No one uses phone books anymore) and pick someone at random. It might also take time to find someone you’re comfortable with.

Assembling the right financial team is a lot like the dating process. You can’t expect to fall in love with the first person you meet. Asking people you know for a recommendation is an excellent place to start. Now days almost every profession has reviews online, and the professions that deal with money are no different.

Cross-reference personal recommendations with online reviews. A good rule of thumb for online reviews is to discount the gushing raves and the deranged complaints. The truth you’re looking for will be somewhere in the middle.

Initial Impressions

First and foremost, you should like and feel comfortable with potential team members. You don’t have to have a beer with them, but you shouldn’t faint at the thought. The old trope about the person who is a real asshole but awesome at what they do is mostly a myth.

Is the person making all kinds of crazy promises about how much they can save you in taxes or make you with their investing prowess? That’s a red flag. You should be able to reach this person anytime you need to within reason. Ask if they mind if you call, text, or email when you have a question.

Of course, everyone is going to say they don’t mind but you need to find out for sure. Test them. Contact them a few times and see how they react. How promptly do they return calls? Do you feel rushed to get off the phone? Are they exasperated when you call?

The Tough Questions

People in the financial services industry know what questions prospective clients are likely to ask. In fact, they prepare for them with role-playing exercises. You need to catch them off their guard. Here are some standard and not so standard questions to lob:

  • When did you begin your practice?
  • Can you explain your fees and what they cover?
  • What is the basis of your investing philosophy?
  • What is your money philosophy?
  • Can I speak to some of your active clients?
  • How do you manage your own money?
  • Can I see your portfolio?
  • What is a bit of information about you that I can’t learn from Google?

Your prospective team member might be taken aback when you ask to see their portfolio, but you are about to get financially naked in front of this person. They should at least show you an ankle.

Breaking Up is Hard to Do

What do you do if a team member just isn’t working out? It can happen no matter how carefully you vet them. It can seem like a hard relationship to sever. This person knows a lot about you. They probably know more about your financial picture than anyone apart from your spouse.

Don’t worry. You can totally ghost on members of your financial team. If it’s an accountant or lawyer, you have all of the same documents they have. They got them from you. Any documents they prepared, they gave you copies of those. You can just start the process again and find a new team member to replace them.

If it’s a financial advisor, you also don’t have to make the dreaded break up call. You can’t just set up a new account with a new company, Vanguard or E-trade, who ever you choose. That company will move the money from the dumped advisor’s to their own for you.

You might be worried about the dumpee calling you up and demanding to know what happened? What did they do wrong? How can they win you back? It won’t come. It’s harsh but true, no matter how close you thought your relationship was, to most of these people, you’re just another client.

The Second String

There is one more aspect to having a good financial team, and it may be the most important, financial friends. True, they aren’t professionals giving you paid advice, but you will interact with them more frequently than your first string team members.

Financial friends don’t necessarily have to have the same level of wealth as you, but they do need to have the same financial philosophies. Good financial friends help you make wise decisions. If you have credit card debt and tell them you’re going to buy a boat, they will tell you not to do that.

The bad financial friend will tell you to buy that boat; you deserve it! (They just want a friend with a boat). Bad financial friends can do a lot of damage because you think you deserve that boat too even though you can’t afford it. You need someone to set you straight.

Good financial friends can help keep you on track, and they aren’t continually tempting you to do or buy things you can’t afford. It’s like going out with a fat friend when you’re on a diet. They encourage you to order that dessert because they don’t want to feel bad when they order it.

A Good Team is No Excuse

You may assemble the greatest financial team in history, the dream team. That is still no excuse to be uneducated about financial matters or ignorant of your own financial situation. When you hear about washed up sports stars who made millions of dollars and file bankruptcy five years after they retire, it’s not just that they were buying Lambos and mansions.

It’s partly Lambos and mansions, but when you hear about someone losing tens of millions of dollars in pretty short order, it’s because they hired people to take care of their money but didn’t know enough to know if those people were doing a good job or robbing them blind. It often turns out that the financial team around them saw an easy mark and took advantage.

Remember, no one will care more about your money than you do, no matter how much you’re paying them. If they are the team, you are the coach and the coach has to know how to play every position.

Show Notes

Investable: Research and evaluate rental properties.

Tool Box: All the best stuff to manage your money.


Laura Fiebert - Head of Operations
Laura is a huge part of what keeps LMM going. She edits the podcasts, books the guests, writes, manages social media (except twitter, she hates it) and a million other things that keep the wheels turning. Most importantly makes sure everything gets done.

She's an avid knitter, wine drinker, and thrifter. A passion of Laura's is second-hand shopping and refashioning vintage clothing. She now has a side business reselling thrift store finds using Poshmark. You can check out her closet here Very soon she'll be launching a site documenting how she runs her Poshmark business so she can teach others how to make money thrift flipping.
She loves cheap champagne, traveling and crappy reality TV.

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