My September column at Physician’s Money Digest was all about finding a good financial advisor.
I am often accused of being “anti-financial advisors.” That’s not true in the least. I recognize that the vast majority of high-income professionals, including physicians, would benefit from using the services of a financial planner and investment manager who offers good advice at a fair price.
Unfortunately, most self-styled “advisors” do not meet those 2 criteria. When searching for an advisor, there are several things you can do to maximize the chances of getting lined up with a competent, fairly-priced advisor right from the beginning.
Most physicians looking for an advisor just want a “money guy” who will take care of everything for them (and hopefully earn them returns high enough that they can retire in their 30s while saving only a tiny percentage of their income!). If they really wanted to learn about finance and investing, and had time to take care of all this “financial stuff” they wouldn’t need an advisor at all. However, even if you choose to use a good advisor, you’re still going to need to learn enough to recognize what a good advisor looks like. I suggest you follow these steps when searching for a competent advisor.
Decide if Local is Important
There are thousands of advisors in this country. Unfortunately, the odds that the best ones live in your city are not very high. There is a very good chance that if you are willing to work with someone living in another part of the country that you will get better advice at a better price. However, this relationship is important, and if you are the type that needs to sit down across the table from someone, rather than interacting via email, phone, or videoconference, then you will have fewer options.
The Big Cuts
You can eliminate most self-styled advisors right off the bat if you throw out all those who are commissioned salesmen with little training. That means choosing a fee-only advisor (not one paid a commission when he sells an insurance-based investing product or a “load” when he sells you a mutual fund) who has at least one of the following designations: CFP, CFA, ChFC, or CPA/PFS.
After politely firing my previous “advisor” who got me into equity indexed universal life insurance and high load mutual funds (while also charging me 75bp for AUM), I found a wonderful fiduciary through the Garrett Financial Network. I pay him by the hour for my annual asset allocation decision as I have Vanguard Index Funds. I feel comfortable with this person as he has an MBA in addition to a CFP, is married to a physician, and he has not conflicts of interest. I am charged an hourly rate and we communicate by phone or email. The advise I get is excellent and I just like to bounce ideas off of him for a few hours per year. He mostly confirms what I know but I am paying for expert advice and validation of my decision making. For me, this is the best money spent and very cost-effective. How many “advisors” will tell you (like mine does) that in regards to investing, you get what you DON’T pay in fees/commissions.
Just like Dr Dahle I’ve worked with a few bad advisors in the past but have also found someone who charges hourly and echoes most of the financial theories laid out in the book, The White Coat Investor (totally worth the purchase). For some reason he now has moved to a group that will charge a flat annual fee, I haven’t decided if it’s worth it for me to do that, I think it’s in the $4,000 range annually.
I’ll give the Garrett group a try, see what they have to offer.
The first thing you have to make sure is that most ‘groups’ are not in the business of providing hourly advice. What is included in the services? Are investment management included? Would the adviser now become a ‘registered rep’ who answers to his higher-ups? Does the firm have any other agendas (such as selling insurance, for example)? These are all key questions. Often ‘groups’ like that higher CFPs and other credentialed advisers to be a front for the rest of the ‘group’ that sells insurance or high costing investment management services. This is why CFP and other designations are meaningless because most CFPs would charge high asset-based fees and many do sell various types of products (including revenue-sharing mutual funds). So before discussing fees, you have to make sure that the adviser is
1) A fiduciary, meaning that they only work for you, not for someone else. Being an employee in a firm makes them much less interested in doing what’s right because the firm has its own agenda.
2) Committed to doing comprehensive planning vs. trying to get you into some of their firm’s products, including wrap programs and investment management arrangements with high fees.
I forgot to mention that the advisor I hired is also a fiduciary. Very important to have this type of relationship.
Love it. The whole “fee-based” model where they get commissions and fees and you get terrible investments. Seems silly to argue about AUM vs annual retainer when you have these jokers out there hosing doctors left and right.
Good article. I would add it’s important to interview several advisors before making a decision. To aid in the interview process NAPFA has a great five page questionnaire(how to pick a planner) to use when interviewing.
I pay most of the professionals that I engage on an hourly basis. My CPA gets paid by the hour; my attorney also charges me an hourly fee. I would also view the financial advisor as a professional who would get compensated on an hourly basis. In selecting the professional, be wary of relatives, friends, church members, or sales people. In fact, most of the advisory firms spend lots of time on sales techniques and very little on planning. It would also help if you bought all the term insurance that you need before working with a planner, so in the event if a slightest hint of UL comes up, you can terminate your relationship.
Just think what it could be like if doctors were paid by the hour… No more coding based billing. 15 min = $75, 20 min = $90, 30 min = $130, 45 min = $170…. For primary care at least, we would spend a lot less time documenting/coding and lot more time providing patient care.
It will never be in the cards but I do see a future in which most primary care doctors will be charging small yearly fees to cover expenses and limit patients to more manageable numbers.
Physicians are one of the few professional degree holders in the US that do not charge hourly rates.
Hourly advice can work for someone who simply wants to some basic advice, but not someone who actually needs ongoing help and support. If you are a small practice owner with many moving parts to your finances (and not much time), you might benefit a lot more from ongoing support rather than spot-checks. The good news is that this type of arrangement is called ‘open retainer’ where you pay an adviser a flat annual fee for a number of services, such as tax planning and ongoing investment management.
Some of the ongoing services that might not be offered by hourly advisers:
1) Proactive advice to respond to changes in your financial situation and/or to take advantage of opportunities (which you won’t get from someone who is called by you to answer questions often after the fact, and who has no incentive to provide ongoing advice or look for opportunities to help you during the year since they only get paid for an actual engagement). So instead of watching the clock, you can always call your adviser knowing that they can provide an answer to you quickly without charging you extra. You never know how much work has to be done beforehand, so a flat retainer can be a win-win.
2) Ongoing investment management help. Hourly advice does not include any ongoing investment management help and/or support. This may be fine for do-it-yourself investors, but many might require more help than that. Usually, hourly advisers charge asset-based fees for investment management (which creates multiple conflicts of interest).
3) Retirement plans. This is really an ongoing service, so for that type of engagement you will definitely need an adviser who can be there when you need it.
If you think that you can benefit from any of the above, you might want to consider an adviser who charges a flat annual retainer.
Personally, I see very small differences between the various fee models- AUM, annual retainer, and hourly. They all have their pluses and minuses and misincentives. The most important thing, IMHO, is to add up the total price and make sure it’s reasonable. For example, if you can get it done for an annual retainer of $1000, or a 10 hours of $200 an hour fees, it seems silly to me to pay $20,000 in AUM fees.
That said, the annual retainer model, like the AUM model, is incentivized to do as little as is required to maintain the relationship. If he can get your work done in 4 hours and charges $5K a year, then he makes $1250 an hour. If it takes him 20 hours, then he’s only making $250 an hour. If he spends 80 hours on you, then he’s only making $62.50 an hour. While I don’t doubt a good adviser might give you proactive advice out of the blue when you don’t expect it or ask for it, he certainly isn’t incentivized to do that. The hourly guy is.
Bottom line, figure out what you need and find a reasonable way to pay for it that minimizes your conflicts of interest. I prefer the hourly model for financial planning and the annual retainer model for asset management. But it’s silly to think that an equivalent fee based on AUM or an hourly is somehow inherently worse than an annual retainer.
Good point. That’s why what I typically do is get a good estimate on the time I will need during the year, and base the fee on that. I don’t mind working more when having to do something. One year it is more, another it is less. For example, one of my clients needed a customized excel tax planning spreadsheet that also has to be maintained continuously. Not something you want to pay per hour because you never know how long it would take. But it had to be done. At $350 per hour (good financial planners start at $250, and good hourly ones – at $350) I doubt you’d want one for yourself even if you needed it. This takes away any questions about the cost, because often things simply have to get done to save money. So while the hourly guy might have an incentive, the client might not, so things will not even be offered because the planner might not want to appear like they are pushing something for money to the client that the client might not need.
Hourly guys manage investments for asset-based fees (1% is typical). That’s the business model. Do you really think that an hourly guy has enough time in the day be called up for face to face meetings for hundreds of clients, if that’s all they do? They wouldn’t be able to survive with a business model like that. This is not their major source of revenue. Very few people request hourly services. Most people actually need ongoing help – except for a number of WCI readers, so one size definitely does not fit all.
The question is, what is the best model for both the adviser and the client? Flat retainer is it for continuous/ongoing services. As far as incentives, if I don’t provide the service whose value exceeds my fee, why would someone want to hire me? An hourly guy gets paid by the hour, an asset-based guy gets always paid. A flat retainer fee has to be earned for sure, and it is probably the best way for the client to get what they want for a fair price – for everyone else who does most of their planning and investing themselves hourly will work just fine.
Does anyone have any experience with the advisors that are advertised here? I am looking for a new advisor to make sure I am on track…
Individual results will vary, and there is no substitute for due diligence. You might want to interview several advisers and find out what they can do for you. Prior to speaking with them, I would suggest that you read some of their articles. I think that those who publish articles about their experience will be much easier to figure out. And of course, do your research as far as their affiliations and allegiances. There are many insurance brokers who call themselves ‘financial advisers’ and who might provide a number of glowing referrals, but that doesn’t make them a good adviser for everyone.
Dan,
Almost any legitimate advisor will provide client references upon request as part of your due diligence process.
– James Osborne
Well those references are of course hand picked and could even be bogus.
For most of us, once u understand what a good advisor does, you don’t need one. I spend a few minutes per year rebalancing through new investment money.
As an advisor who works with 300 physicians as their financial planner, there is another business model inherent in working with graduating medical students, residents, & fellows. My wife is also a physician (finished residency last year), so I believe my perspective is more in-depth in this marketplace than any physician-advisor I’ve encountered…
To put it bluntly, these physicians still in training are rarely willing to pay a fee to talk with an advisor on an hourly basis. I work on an implementation-basis, where I can earn commissions through disability insurance, life insurance, and investments. From what I’ve read in this post and this website, with this model I should be forced to apologize as I must be primarily interested in earning the highest commissions and taking advantage of their naivete. How can one not be blinded by a $300 commission for disability insurance, $130 for term life insurance, or $20 on a C-share Roth IRA mutual fund that we’ll move to an AUM fee based-platform once the client has enough assets?
With the reputation I’ve established in my local marketplace, you must understand that there are good, ethical advisors who not only want to do the right thing for their clients, but also prescribe with an expertise that I should be charging a hourly fee for if only my market (students, residents, fellows) were willing to pay it at that stage in their lives. For the value I provide in helping them decide on PSLF vs. refinancing, starting Roth IRAs, obtaining employer-discounted disability insurance, life insurance, and advising on home financing, I deserve to be compensated fairly.
I sleep well knowing I’m doing the right thing for my clients as the expert they deserve, and grateful that I can earn a good living through the volume of my clients rather than trying to make a sale.
Food for thought…you do the dishes.
Reminds me of a famous Upton Sinclair quote- “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”
It also reminds me of doctors who believe that pharmaceutical reps bringing them lunch doesn’t influence their prescribing habits when all the data clearly shows it does. People respond to incentives, whether consciously or subconsciously. It requires a superhuman dose of ethics not to. It’s a systems problem, don’t take it personally. I’m not saying YOU’RE NOT ETHICAL (although it’s possible you’re not.) I’m saying you’re working in a system where you are incentivized to do the wrong thing, and that’s a problem.
I’ve been a resident. I was more than willing to pay an annual retainer fee for advice. I did so. Then the advisor sold me crappy front-loaded, high ER investments that also had a load, probably not so dissimilar from the ones you’re selling your clients. (Shame on me for not knowing that fee-based isn’t the same as fee-only.) I suggest that if you first educate them on the importance of getting fee-only advice you might be surprised how many of them are willing to pay a reasonable hourly fee. Since you’re apparently not making much ($20 a head for investing advice), you ought to be able to have a very low hourly rate and make the same amount of money, no? You can even offer to discount their hourly rate by what you’re making on the insurance commissions.
Do yourself and your clients a favor and move into the fee-only world. Figure out what kind of an annual retainer or hourly rate you need to charge to stay in business, make a fair profit, and meet your goals. Then show your clients why they should pay you that way. I think you’ll find they’re willing to pay you that way once they understand how it benefits them. There are many hourly-rate advisers all across the country. Don’t tell me the model isn’t sustainable. Allan Roth has got people lined up out the door willing to pay him $450 an hour.
Jim, I congratulate you on the success of your website and book. I already understood that you will never respect my business model because of your personal experience with an unethical advisor. I’m not advocating that my business model creates pristine advice that an advisor WITHOUT personal ethics or an in-depth understanding of a physician’s financial situation could fill in my shoes and instantly do what’s best for each of his clients AND still make an honest living. Without those pre-requisites, any business model will harm the client.
For instance, two days ago I was speaking with the president (also a physician) of a physician private practice to confirm if they were moving forward with our recommended changes to their PSP. The plan’s current advisor is a fee-only advisor who either recommended or abided by the physicians’ request to use Infinity Funds as the plan’s investments. Through an analysis ot the plan’s design and expenses, we determined this fee-only advisor was earning $60,000/year minimally on $9M of plan assets as her asset-management fee. We spent hours proposing a better platform with Transamerica that significantly reduced the overall fees for each participant by 50% with more asset class options…a no-brainer.
Instead, the group opted to keep everything as is, and coincidentally the same fee-only advisor has significantly reduced her fees going forward. My strong suspicion is that the group felt like a fee-only advisor must be holier than me, and regardless of my recommendations, my advice must be lesser than that of a fee-only advisor, even one who is happy to charge uncompetitive AUM fees for a crappy plan. What are the ethical guidelines here?
But coming back to my point about working with residents & fellows, the average resident or fellow is certainly NOT willing to pay a fee to meet with me. This is hard for you to relate to since you are NOT the average physician when it comes to regard for personal finance. My average client does not find me by lining up outside my office…I must find them. By speaking with residency/fellowship programs about physician financial planning, I’m able to meet prospective clients. My main competition isn’t Do-It-Yourself, it’s Do-Nothing-At-All-because-I’m-working- 80-hours-a week-and-don’t-have-time-or-don’t-really-care. Is this resident worse off after I spend several hours educating him and help him set up a Roth IRA and disability insurance than he was before he met me?
You provide a significant value to the readers of the website. You must obviously understand that many physicians would prefer to never think about their personal finances. And for the readers of this website, they are not my target audience, and I respect that. I’m just asking for you to do the same.
You’re asking me to believe that a commission-based model is better or even just as good as a fee-only model because you know of a bad advisor that happens to be fee-only? Sorry, don’t buy it. Most fee-only advisers are incompetent and/or charge too much. But I’d bet that the percentage that are competent is far higher than the percentage of competent commission-based advisers.
If students/residents/fellows are unwilling to pay a dime for good advice, then that makes what this website is doing all the more important. I will continue to recommend against people using a commissioned salesman as an adviser. Just because there is one ethical, competent, fairly-priced commission-based “adviser” is not a reason to recommend that model. I’m sorry, it’s a flawed model. Lots of good people may be stuck with it, but that doesn’t change the fact that it is flawed. If the only way you can get someone to pay you for your expertise is to somehow hide your fees from them, that says something, doesn’t it?
Many of us on this forum have been the ‘Do-Nothing-At-All’ that you describe who fell for the commissioned model. My advisor too had at one time led me to a platform like the one you have alluded to with huge kick-backs. These revenue sharing arrangements were never disclosed until the DOL rules came into effect a couple of years back. In investing, there is no free lunch. To maximize my returns, I have to reduce my costs. It’s that simple. Unfortunately, your ilk have done their best to earn the commissioned sales agent line of work the disrespect shown on this forum. Transparency up front would be a good start.
I think this ‘fee only’ vs. ‘commission only’ example is a perfect illustration of what typically happens in the financial industry.
The ‘fee only’ crowd can often be just as bad as the ‘commission only’ crowd. In both cases, the client suffers because neither adviser is acting in the best interests of the client, so they don’t have to recommend low cost index funds or act in a fiduciary capacity. The funny thing is that the assumption is (thanks to NAPFA and CFP marketing) that ‘fee only’ is somehow a guarantee that one is working with a fiduciary. Nothing can be further from the truth. Any adviser charging asset-based fee is not (and can not) be a fiduciary! A perfect example is the adviser charging a fee that came out to $60k for a small plan. Does anybody doubt that the amount of work would not double if the assets in the plan double? How much more would this ‘fee only’ adviser be getting by using expensive mutual funds that pay revenue sharing? Does this adviser even offer any services other than fund picking that can benefit the plan and plan participants (participant advice, investment policy statement creation and maintenance, model portfolios, etc)?
This is why retirement plans (and individuals) should stick to flat fee pricing model for continuous and ongoing engagements that involve investment management. Specifically for retirement plans, the adviser has to at least be a 3(38) fiduciary (in writing), and work in the best interest of the plan participants, select open-architecture TPA/recordkeepers and use low cost index funds (~0.15% average expense ratio) for plan investments. The whole point of being a fiduciary for a retirement plan is to minimize fees and expenses (not just to make sure that they are ‘average’, since small plan average fees are extremely high) by avoiding any and all asset-based arrangement in favor of flat fee pricing for all plan providers.
Investing is just like coding. As a physician at first you want to avoid it. Later on you realize that you must fully understand it. Doing so will give you the freedom to be a better physician. Not doing so will result in working longer, “need” to overbook or other factors that will affect your enjoyment of our field.
I too am a “fee-based” CFP professional and married to an MD. The advice that my clients get from me is better suited for them than the advice they get from pretty much anywhere else. The only reason that I am “fee-based” is because I want to be able to help my clients with their disability insurance and life insurance needs, 99% term,it is very rare that I recommend permanent insurance. In the end, I want to have a flexible business model. I know the WCI values disability and term life insurance. I know that “fee-only” advisers recommend these products (and charge a fee to tell someone to buy these products). I am extremely well versed in the products and am independent (bought it for my OBGYN wife), so I feel there is nothing wrong with showing my clients their options when it comes to these products and “selling” them these products as part of my business engagement with them.
I work with residents and fellows at a very low price point to earn their future financial planning, tax, and disability insurance business. They may invest with me but are not required too. I am very well versed in IBR/PAYE/PSLF and other physician specific areas. I doubt there are many other financial advisers with my skill set in the country regardless of business model.
I don’t sell mutual funds or loaded investments. I do charge an AUM for investment accounts and I charge a $2,000 initial financial plan fee and a low retainer for keeping the plan updated and includes 1040 tax preparation. I will never be able to call myself fee only because I want to have a big book of disability insurance under my belt. Clients can invest with me or not, but the financial plan and investment management should be 2 separate services, if they are not then they really are not “fee-only” in the truest sense of the term. All CFP’s are required to act as fiduciaries while building a financial plan and those who charge AUM or fee’s for investments are fiduciaries to the investment plan. I saw someone else say they were paying .75% AUM fee and were being sold loaded mutual funds, that is wrong if true.
Also, as for the comment of showing client references, that is a no-no when working as a fiduciary. I am not allowed to show written references from clients similar to how doctor’s would have a HIPPA violation for showing their patients names. If you need references, then it would come from other doctors that refer you to the adviser. When my doctor prospects ask me for “client references” I simply ask them how they heard of me. I don’t show any letters or list of client names, that is not allowed.
“Also, as for the comment of showing client references, that is a no-no when working as a fiduciary. I am not allowed to show written references from clients similar to how doctor’s would have a HIPPA violation for showing their patients names. If you need references, then it would come from other doctors that refer you to the adviser. When my doctor prospects ask me for “client references” I simply ask them how they heard of me. I don’t show any letters or list of client names, that is not allowed.”
This is very misleading and largely untrue. A Registered Investment Advisor is prohibited from using client testimonials/endorsements in advertising but is in no way restricted from providing a prospective client the contact information for existing clients who have agreed (in advance) to act as a reference for the advisor. We’re not talking about a full client list with personal information or a pre-printed sheet of testimonial statements from clients. We’re talking about giving a prospective client the names and phone numbers or email addresses of a handful of clients who have released the advisor to share that information.
Here’s a summation on this topic from a nationally-recognized compliance firm: http://blog.advisorassist.com/2013/08/cco-series-advertising.html
It’s fine if you don’t want to ask clients to serve as a reference on your behalf but don’t make it sound like this common practice of advisors (including fiduciaries like myself) is illegal or unethical.
Mr. Osborne,
If there is a will there is a way. I didn’t say it was unethical for this, I just remember when I was taking the S66 that client testimonials are not allowed. I would prefer to steer clear of any possible violations of IA of 40 act. I certainly have client’s who would talk to prospects on my behalf, in fact that is how most of my business is generated, my doctors tell their friends about me. If you have prospects call your clients who have agreed to speak on your behalf, that is great for you. There is a gray line there, I am not going to walk near the line, I guess I don’t need or want to. I really have no opinion (ethical or unethical) on this subject other than I know there are rules about client testimonials. There is so much regulation in our world that I would prefer to not have that headache if I don’t need to, I don’t have the will.
I guess I worry less about a “fee-based” financial planner or investing manager when their only commissions are coming from term life insurance and disability insurance. I would describe you as a fee-only financial planner, a fee-only investment manager, and an insurance agent rather than a “fee-based planner”. You’re wearing a lot of different hats, as do many in the industry.
Well, that is thing. I could care less what I am called but in the financial adviser world there is a huge debate about how someone describes their business model. The fact that I sell any insurance at all means that I am “fee-based”. As I am sure you know, there is “fee-only”, “commission based”, and the hybrid “fee-based”. Obviously the “commission-based” is a dinosaur model and will be extinct soon. In 10 years there will be “fee-only” or “fee-based”. Both have merits and conflicts, as you point out “fee-based” has more conflicts but I am fine with that, flexibility in working with clients is more important to me than how I am forced to describe my business model. All fees and commissions are disclosed.
Yes I wear a lot of hats, you forgot about taxes too. I dedicated 3 years to educating myself (before taking on clients) on top of my international business degree with finance as my specialization. The CFP, the EA, and living with a doctor helps me wear the hats. You are a doctor and have learned more about financial topics than 99% of my colleagues. People in my business need to take it as seriously as non-interested bloggers. I still have a ton to learn.
While I hate the commissioned model for financial planning and asset management, I doubt it’ll be extinct soon. I just had someone on the site last week defending it saying he was giving the best advice of anyone out there despite being commissioned. I told him I disagreed but didn’t expect to convinced him. The vast majority of “financial advisors” are still commissioned salesmen.
In 10 years the number of fee-based/ fee investment advisers and financial planners will be larger than straight commissioned advisors. Merrill and Morgan and more of the behemoths are making their reps get S66 so they can go the fee route. The number of life insurance agents is significantly down from the 80’s/90’s and I expect the same to happen with investment management. People are onto the A Share/B Share mutual fund sales. The only issue is that some people hate paying fees even if it is best for them so they will pay fees for a little while and then migrate back to commissions because they weren’t “paying” a fee to begin with.
After several decades of handling my own finances except for taxes, I felt I was getting to ruminative and started using a CFP who was recommended by my accountant. I’m in California; they’re in NYC. It’s been three years, and I’m quite pleased. Key issues:
• They act as fiduciaries.
• Their approach is driven by academic research, e.g., no individual stocks, emphasis on low-cost index and index-like (DFA) funds, etc.
• I can pay either by the hour or based on assets under management, with AUM fees less than 1%.
• Their focus is on people in similar financial situations to mine.
• They never try to sell me anything.
I had a low-cost, diversified, Boglehead-style portfolio when I started with them. It’s now a bit more slice-and-dice. For me, the payback is more emotional than financial. I’m less worried and less ruminative.
Thank you for sharing your experience. I’ve had at least one financial advisor tell me his goal is to be my financial advisor some day!
My husband and I have decided that we are in some need of help with our finances, and this sounds like finding a financial planner could be a good way for us to go. I appreciate the suggestion you give of looking for one who does not get paid a commission when he sells. I imagine that that would mean he or she has integrity to keep the prices low and workers honest. Thanks for sharing this!
Thanks for the tips for choosing a financial advisor. I have been thinking about hiring one for a while, because my wife and I want to do better about saving and investing our money. I like that you mentioned to decide early if it is important to you that your advisor is local. I need to sit down and talk to somebody face to face, so I will keep my eyes open for somebody in my area.
Why are you spamming my website “Burt”? Your message and the fact that it links to a financial advisor’s website aren’t particularly congruent. I’ve emailed the firm that hired you and let them know you’re doing a lousy job advertising for them.
I agree that you need to consider if finding a financial planner that is local is important to you. It would seem that this would depend on how you work with someone and whether you want to work with them face to face. I’m looking for a financial planner to help me out so I’ll have to find one that I can meet with face to face.
No you’re not. If you were looking for a financial planner you wouldn’t link to one with your comment. Give me a break. You’re just spamming my site.
Thanks for the great tips for hiring a financial advisor. I think that looking for someone local is definitely a priority for me. Local finances and things can change where you live, so I wouldn’t want to hire someone from out of town.
You’re not alone in feeling that way, nor alone in being a financial advisor sockpuppeting as a potential client.