My fiancé got a $300,000 inheritance, and he needs a financial adviser, but I worry he’ll be taken advantage of. What’s my move?


Question: My fiancé has received a little over $300,000 from an inheritance. He needs a financial adviser or someone that can point him in the right direction on how to handle that kind of money. I see him being a little too free with it and being taken advantage of. What type of adviser should he be looking for?

Answer: It would be a good idea for you to have your fiancé search for a fee-only, certified financial planner (CFP) — you can use this tool to get matched with a financial planner who might meet your needs — and see about doing either a one-time planning fee or hourly rate to start, pros told us. “In general, I tell people who have a sudden wealth event to slow down, not make any irreversible decisions quickly and talk to a professional,” says certified financial planner Neela Hummel at Abacus Wealth Partners. 

Have an issue with your financial adviser or looking for a new one? Email picks@marketwatch.com.

It’s important for your fiancé to look for a financial planner who not only can help him invest the money (if that’s what he’s doing with it), but will also take a look at his entire financial life. “You want someone who will help look at cash flow and expenses, taxes, retirement planning and can help decide the best route forward. Depending on the type of account, you may need to withdraw in 10 years — and if so, you want to be wise and optimize tax brackets,” says Thomas Kopelman, head of community at Wealth.com. 

Some of the things an adviser needs to look at in this situation are whether or not your fiancé wants to spin income off this money or if he just wants it to sit there. Determining whether he wants or needs access to the funds as well as his investment horizon will impact the types of investments he engages in.

Specifically, you might want to engage a fee-only CFP. They are required to operate at a fiduciary level, meaning they don’t accept commissions and are only paid directly by the client, and are required to pass exams and have plenty of professional experience. “Your fiancé is unlikely to be sold on a bunch of high fee or garbage securities with that kind of adviser,” says certified financial planner Matt Bacon at Carmichael Hill & Associates. 

When looking for an adviser, you can also conduct some due diligence by looking at the SEC’s Investment Advisor Public Disclosure portal. “Complaints, regulatory actions, settlements, work history and a host of other useful information about the adviser sits there,” says Bacon. It’s also important to find an adviser who will explain things in a way you understand. “You shouldn’t have anything in your portfolio that you don’t understand. Investing doesn’t need to be complex,” says Trubow.

It’s a good idea to interview multiple advisers to get a sense of their communication style, fee structure and experience. MarketWatch Picks has compiled this list of questions that investors should ask prospective advisers.

In addition to feeling someone out on a personal and professional level, it’s important to consider how you’ll pay this person. Seeking out an advice-only, fee-only planner who charges hourly or per project is probably the best route for someone in your situation. Hourly planners tend to charge between $150 and $450 per hour, while one-time project-based advisers can cost between $2,500 and $7,500. 

It might even be helpful to find an adviser who has a tax background, like a CPA, since certified financial planner Bruce Primeau at Summit Wealth Advocates, says, “Taxes touch everything,” and inheritance can also be subject to taxes.

Prior to meeting with a potential adviser, “Your fiancé should be prepared to explain what the purpose of the funds is and to complete a risk tolerance questionnaire so the adviser can make appropriate recommendations in terms of how aggressively or conservatively the funds should be invested,” says Primeau.

Furthermore, as a couple, it sounds like you’re at a point in life where you’re starting to plan your finances together. “It might be a good time to jointly discuss life and financial goals and engage with a professional who can help bring clarity to your finances and set you up to achieve your goals,” says certified financial planner Josh Trubow at Sensible Financial.

Looking for a new financial adviser? This tool can match you to an adviser who may meet your needs.

Have an issue with your financial adviser or looking for a new one? Email picks@marketwatch.com.



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