What Should You Expect From Your Financial Advisor?

by FirstWave Financial

Consumers are inundated with advertisements about why they should use a particular financial service. I expect that most consumers seeking help with their personal finances behave like me when I am looking for an auto mechanic or home contractor – that is, even if time is devoted to carefully searching for the right person or company to help guide them, they feel overwhelmed and ultimately just hope that they make a good choice.

Most consumers are probably attracted to a particular advisor by the prospect of superior returns. The honest-to-goodness truth is, portfolio management is only a small part of a good financial advisor’s value proposition. Furthermore, it is far from clear that anyone can deliver returns that are consistently superior to the market. On the other hand, it is clear that there are many folks that hold themselves out as financial advisors who consistently under perform the market (despite what their marketing materials may suggest!)

Now that we know what shouldn’t drive your financial advisor decision, we here at our wealth services firm in Satellite Beach , FL would like to share the things that you should be looking for in your financial advisor.*

Expertise – Your advisor should be an expert (or have a member of his or her team who is) in the various disciplines of personal financial planning. Portfolio management, risk management, estate planning and tax planning come to mind. Importantly, the advisor that you choose should also have the experience and judgement to know when it is appropriate to bring in outside experts.

Comprehensive – The best relationship with a financial advisor is one in which all of the aspects of your financial life are in harmony because he or she has analyzed all of your data and synthesized it into a coordinated plan. As the relationship with your advisor matures, and he understands you and your financial life better, the value you receive from this aspect of the relationship will compound.

Fiduciary – All of the recommendations your advisor makes should be in your best interest. To paraphrase Warren Buffet, you never want to have to ask your barber if you need a haircut.

Organization – Let’s face it, you have better things to do than to track down the tax basis of the stock you inherited from your Aunt twenty years ago. The advisor you choose should be happy to bring organization to the complexities of your financial life.

Accountability – I am not referring to the advisor’s accountability. Hopefully that is a given. You want your advisor to help you fulfill your financial commitments.

Proactive – Your financial advisor should alert you to the pitfalls and opportunities in your financial life.

Emotional Intelligence – As you think about your money and what it means to you and your family, it is easy to become emotional. Financial advisors are typically not licensed therapists, however, the best ones have a high emotional IQ and when they help clients make important financial decisions, they consider the emotional as well as the analytical components.

One final word about portfolio management. Your financial advisor’s portfolio management should make for pretty boring water cooler chat. In fact, he should manage your portfolio in a way that you will seldom even think about it. But during those inevitable periods when the market is performing poorly and it seems like all of the news headlines are begging you to abandon the stock market before you’re reduced to living with your children in retirement, your financial advisor should communicate with you regularly and remind you that your portfolio is resilient and well-suited for the job of helping you achieve your long-term goals. Our wealth services firm in Satellite Beach, FL would love to answer any further questions you have regarding what to look for in your financial advisor or how we can help you create the life you dream about. Call us today at (321) 773-7773 to speak with one of our WealthCoaches™.

*A debt of gratitude is owed to Mitch Anthony, owner of Advisor Insights, whose lecture, “Moving from ROI to ROL (Return on Life),” was the source and inspiration for this post.

You should not assume that any discussion or information contained in this publication serves as the receipt of, or as a substitute for, personalized investment advice from FirstWave Financial. A copy of the FirstWave’s current written disclosure statement discussing our advisory services and fees is available upon request.