Questions to ask before making any financial decision
Whether it is hiring a financial advisor, picking a mutual fund, or refinancing your mortgage it is a good idea to ask a lot of questions when it comes to your money. However, if you only ask a few, here are our top 3 questions to ask before making any financial decision.
What is the investment philosophy?
Make sure to ask yourself if the investment makes sense to you. It may be great for 99% of the population but is it a fit for you and your current situation. Does it match up with your risk tolerance and timeline? Really take the time to contemplate this. Further, do you understand it? Or is it too complex? Understanding this will help move you forward in a meaningful way.
Do I trust the person giving the advice or offering the investment?
Simply put, what is your gut telling you about who is behind this. What is the person’s credibility and credentials? Was it your cousin Eddie spouting off a stock tip at the family reunion? Or a longtime friend and financial advisor who has been in the industry for years? It may seem like a no-brainer to ask this question, but it is sometimes easy to get caught up in the hype of the product and the potential returns.
A quick way to tell if an advisor truly has your best interest in mind is if they are CFP® (Certified Financial Planner)- learn more on thathere, but in short, it means they are a true fiduciary and must have your best interest in mind regardless of commissions. Trust is so important; don’t take it lightly.
What is the downside risk, and can I afford it?
What can you stand to lose? Sure, look at what the potential of the investment is, but don’t ignore the risk. Make sure the amount you invest matches your risk tolerance. The old saying stands true here- “Don’t put all your eggs into one basket.” Before you make an investment decision, know the risks.
Short and simple, those are the top 3 questions to ask before making any financial decision!
Are you considering an investment and aren’t sure if it is right for you? Asked these questions and are still unsure? We are here to help…just set up a call.
Managing your finances can be difficult and time-consuming. However, finding someone to handle your finances can be just as challenging. Want a tip to make it easier? Hire A CFP ®.
People often ask us what is a CFP ®, how are they different from other financial advisors, and the reasons to hire a CFP ®. We are going to be breaking all that down for you today.
What Is a CFP® Professional?
First, it’s more than just an acronym. Unlike some designations that are worth little more than the paper they’re printed on, the CFP ® (CERTIFIED FINANCIAL PLANNER™) designation is one of the most esteemed financial certificates around. Each CFP ® is held to an extremely high standard and requires an immense amount of work. Typically nine months to two years of study.
In the US, as of 2025, there are only 101,505 CFPs ® and only 3,150 in the state of Colorado, according to the CFP® Board professional demographics. The exam itself is a grueling 7-hour test that assesses the financial advisor’s ability to apply principles of financial planning. It covers all areas of insurance, investments, income taxes, retirement, estate planning, ethics and conduct, and financial plan development, among many other skills.
Beyond the test, there is so much more that goes into the certification. We have condensed it down to the top 4 Reasons to Hire a CFP®.
4 Reasons to Hire a CFP ®
Fiduciary Standard
Ethics Code
Fitness Standards
Experienced Life-Long Learners
Let’s dive into it:
1. Fiduciary Standard:
Currently, the SEC has NO uniform fiduciary standard that applies to all financial professionals who provide personalized investment advice. This means there is no oversight to protect consumers and clients from paying excessive commissions or receiving substandard performance. Consumers are exposed to even greater and unnecessary risks from products that may be deemed suitable (more on that here) for them but are inferior to other available options and not necessarily in their best interests.
The CFP ® Board has a Code and Fiduciary Standards that require CFP ® professionals to act in the best interest of the client at all times when providing financial advice. So, as a CFP ®, we have a legal requirement to act in your best interest, all the time. In addition to this standard as a true fiduciary, Bonfire Financial is also a Registered Investment Advisor which furthers this obligation.
2. Ethics Code:
All CFP ® practitioners agree to abide by a strict code of professional conduct, known as CFP ® Board’s Code of Ethics and Professional Responsibility, that sets forth ethical responsibilities to the public and clients. This ensures we act with honesty, integrity, competence, diligence, and offer services objectively.
It’s a pledge to protect the confidentiality of all client information, avoid or disclose and manage conflicts of interest and always act in the client’s best interests.
3. Fitness Standards:
Further, the CFP ® Board has also established specific character and fitness standards for the CFP ® certification. This ensures that an individual’s prior conduct would not reflect adversely upon the profession or the CFP ® certification marks. This helps you know that if you hire a CFP ® you won’t find out later that they have:
A felony conviction for theft, embezzlement, or other financially-based crimes.
A felony conviction for tax fraud or other tax-related crimes.
Revocation of a financial license (e.g. registered securities representative, broker/dealer, insurance, investment advisor).
A felony conviction for any degree of murder or rape.
A conviction for any other violent crime within the last five years.
A felony conviction for non-violent crimes (including perjury) within the last five years.
Personal or business bankruptcies.
4. Experienced Life-Long Learners:
CFP ® professionals are required to complete 3 years of experience related to delivering financial planning services to clients. They also must have a bachelor’s degree prior to earning the right to be a CFP ®. This real-life experience means that CFP ® professionals have practical financial planning knowledge. They can truly help you create a realistic financial plan that fits your individual needs.
Once certified, CFP ® professionals are required to maintain technical competence and fulfill ethical obligations. Every two years, they must complete a minimum of 30 hours of continuing education to stay current with developments in the financial planning profession and better serve clients.
Need more reasons to hire a CFP ®? We’d love to answer any other questions on what it means to have a CFP ® working for you, feel free tocontact us.
At Bonfire Financial we pride ourselves on having a team of CERTIFIED FINANCIAL PLANNERs™ and we can’t wait to help you!
As I look back on my life some of the best memories and conversations have happened sitting around the fire. I have been pumped up at a homecoming bonfire. Inspired by having deep conversations with friends about the future around the fire. I have felt close to my family on camping trips roasting marshmallows on the fire, and I have felt at peace sitting at a fire and staring at the stars. Fire is life and all of these are moments are cherished.
Life is meant to be experienced.
That sounds good and all but I am a financial advisor and what does that have to do with financial advising?
I say everything! Or at least it should. Money is a vehicle for those experiences and the time to enjoy those moments. The more money you have, the more experiences you can afford to have with your family and friends. You can give more to the causes you care about. The more peace of mind you can have.
I wanted to create a company that focused on that outcome, not just dollar figures.
Everyone has different goals and dreams and how they want to spend their life. What Bonfire Financial does is focus on those and come up with solutions to meet them as efficiently and as quickly as possible. My hope is that our clients will enjoy even more moments sitting around the proverbial bonfire celebrating their lives.
In the many years I have spent in the financial industry I have seen that most financial companies only focus on the bottom line. They prioritize their shareholders’ value. This means that the decisions made about the company are not necessarily about how to add more value to the client. They are often about how to improve the share price. A good share price is nice but it comes at the expense of the client, and the employees of the company.
So why is Bonfire Financial different?
We created Bonfire Financial as a fee-only registered investment advisory firm (RIA) so that we could be true fiduciaries to our clients. We are based in beautiful Colorado Springs, but serve clients throughout the US. All of our advisors are CERTIFIED FINANCIAL PLANNERs™ As such, we are true fiduciaries and we must do what’s in the best interest of our clients at all times. In effect, putting our clients first, which is where we think they should be. We have a belief that if we add more value to our clients than anyone else, not only will they be happy, the company will thrive.
So, as a constant reminder of these philosophies, we came up with a name that reminds us to focus on the client’s outcome every day so that hopefully soon we will all be sitting around the fire celebrating!
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