Becoming a new client? Here's sample of a Financial Planner Questionnaire
Before we jump right into the questions, let’s take a quick look at the common categories of questions a client may encounter.
Personal Information: This section collects basic details about the client, such as their name, age, marital status, and dependents.
Financial Goals: Here, the advisor seeks to understand the client's short-term and long-term financial objectives, such as retirement planning, saving for education, or purchasing a home.
Current Financial Situation: This part focuses on the client's existing financial circumstances, including income, expenses, assets, debts, and any relevant insurance coverage.
Risk Tolerance: These questions gauge the client's comfort level with investment risk and help the advisor determine suitable investment strategies.
Investment Knowledge & Experience: The questionnaire may inquire about the client's investment background, understanding of financial concepts, and prior investment experience.
Time Horizon: This section assesses the client's investment time frame, which can influence the recommended investment strategies and asset allocation.
Liquidity Needs: The advisor may ask about the client's short-term cash flow requirements or emergency fund needs to ensure appropriate asset allocation.
Tax Considerations: Questions related to the client's tax situation, including income tax bracket, can provide insights into tax-efficient investment options.
Estate Planning: Depending on the scope of services provided, the questionnaire may include inquiries about the client's estate planning needs and any existing arrangements.
Other Financial Matters: This section may cover additional topics such as insurance needs, specific investment preferences, or any unique financial circumstances.
In a perfect world it would be 1 standard format but the number of questions can vary from planner to planner. It is not uncommon for such questionnaires to consist of 30 to 50 or more questions.
Here’s a sample of key questions from 5 out of the 10 categories listed above. And, note what the answers could reveal about the new prospective client.
Personal Information:
a. What is your marital status? -Reveals the client family structure and potential financial responsibilities.
b. What is your highest level of education? -Provides insights into the client’s educational background and potential financial knowledge.
c. How would you describe your employment status? -Indicates the client’s source of income and stability, influencing their financial planning needs.
Financial Goals:
a. Which of the following is your top financial goal? -Identifies the client’s primary objective, such as retirement planning, debt repayment, or saving for a specific milestone.
b. When do you plan to achieve your financial goals? -Reveals the client’s opinion on the time horizon for accomplishing their objectives, influencing the recommended investment strategies.
c. What level of financial comfort do you aspire to? -Provides insights into the client's desired lifestyle and financial expectations.
Risk Tolerance:
a. How would you describe your attitude toward investment risk? -Gauges the client's comfort level with market fluctuations and potential losses, helping determine suitable investment strategies.
b. How would you react to a significant drop in the value of your investments? -Assesses the client's emotional response to market volatility and potential willingness to tolerate short-term losses.
c. What is your investment experience? -Indicates the client's familiarity with investment products and their level of exposure to different investment opportunities.
Investment Knowledge and Experience:
a. Which statement best describes your investment knowledge? -Reveals the client's understanding of financial concepts and familiarity with investment terminology.
b. Have you invested in stocks, bonds, or mutual funds before? -Provides insights into the client's past investment experiences and exposure to different asset classes.
c. How would you rate your ability to make informed investment decisions? -Assesses the client's confidence in their investment decision-making skills and potential need for guidance.
Time Horizon:
a. When do you plan to start accessing the funds you invest? -Identifies the client's investment time frame, influencing the recommended asset allocation and risk management approach.
b. Which statement best describes your investment time horizon? -Reveals the client's investment timeline, such as short-term (less than five years), medium-term (five to ten years), or long-term (over ten years).
c. How important is it for you to preserve the value of your investments in the short term? -Assesses the client's need for liquidity and potential willingness to accept short-term fluctuations for long-term growth.
BMG's objective when signing a new client is to collect and analyze the responses of a financial questionnaire. Due to the valuable insights they provide, this process enables us to create a personalized plan for each client. We are committed to empowering our clients with informed financial decisions that can pave the way to a prosperous future.
