An orange origami bunny hopping toward her investment carrot patch. A wagon train led by handsome horses steering toward a retirement hitching post. Green arrows reminiscent of Oz illuminating the path to financial freedom. Can we gather tips from television commercials to guide the consumer to the right financial advisor?
Judging by the way most people find me, the answer is no. Most inquiries begin with this Google search: “Fee Only.” It is a good place to start, but it’s like saying you want to go to a restaurant to eat. Steak and potatoes? Soup and salad? Spaghetti and meatballs?
Consider these real-life examples—with names and identifying details altered to protect my clients’ privacy, of course . . .
Jenny just left a rewarding career and started life after full-time work. A diligent saver who caught a couple lucky breaks, she avoided common financial mistakes, like the fancy car and the cute-but-costly home. She thinks she can make her money last but is she right? She worries about her blind spots. And she really isn’t sure—where should her income come from, and how much can she spend? Uncertainty and fear drive her to be frugal, but she wonders—can she let go a little and have fun without jeopardizing her future?
Mark and Karen took a vacation a couple of months ago. They almost canceled their trip because of the endless To Do list, and at the top of it is figuring out the sprawl of accounts they have accumulated. How much do they have? Is it in the right investments? How are they doing? The change of scenery on their trip brought the opportunity to take a breath. They found themselves turning to each other at dinner one night and blurting out, “We need help to sort this out.”
Francine and her neighbor Jo raised their children side-by-side and have been talking for years about how their houses have become more burden than blessing. They were about to tour a senior community when Jo fell in her backyard, and Francine watched the opportunity to choose “What’s Next” taken away from her friend. With it went the chance to sort her belongings, to decide what treasures to keep and what to give away. Jo also missed the possibility of making new friends while she still wanted to invest in that effort.
The right financial planner may be different for these three clients.
I will tell you what I see each is looking for and give you some free advice about what to know about yourself and what to ask in an introductory meeting or call when you begin your search for the right financial professional for you.
Jenny is looking for a financial professional whose unbiased advice she can trust. She wants to take control of her cash flow and know how her portfolio will support her for the rest of her life. She wants to minimize risks she doesn’t need to take and avoid mistakes, and she wants a plan that gives her financial freedom to spend on her dreams. She would be comforted by having a thinking partner who is walking side-by-side with her as she navigates the changing terrain.
Jenny wants an advisor who collaborates with her, rather than one who sees her value as an expert dispensing advice. This will be evident from the questions the advisor asks in their introduction. Does the advisor seek to diagnose problems and tell how she will fix them? If the advisor starts talking in alphabet soup about investment options or isn’t curious about what financial freedom would bring Jenny, I suggest she keep looking.
Mark and Karen are daunted by the complexity of the choices they face to simplify their financial life, but they are not sure they want to give up managing their own money. They want to know where they are, where they are going and how to close the gap between the two. An advisor who offers a financial check-up, a bit like a check-up at the doctor’s office, will give these Do-It-Yourselfers the foundation to work on their own to consolidate accounts, rebalance their portfolio and change their investments to be more tax-efficient and easier to manage. In time they might see the value of a full-service planner, to achieve their financial goals in a fraction of the time, worry and energy that it takes to do it themselves.
Francine wasn’t aware that there are financial professionals like me who specialize in helping people at the intersection of health, wealth, and end-of-life. I call it Long Life Planning and the goal is to help my clients transition out of this life preserving the legacy they want to leave behind. I helped her figure out what really mattered to her to have the best life possible now and connect those ideas at her heart’s core with her financial decisions.
In the process of looking for the right financial advisor for you, think about what you are looking for. Advice and DIY from there? Validation about a specific question? Or is your true wish to find someone whose unbiased advice you trust, and you want to delegate it. I encourage you to think about where you fall on the axes of fear of loss or hope of gain—are you looking for an advisor to help you reduce financial stress and worry? This would probably take you to an advisor who, as one advisor I admire puts it, is in the “transportation business—taking you from where you are to where you want to be.” Make sure in your introduction that they listen more than they talk. If you are concerned with how your investments are performing and aren’t that interested in a comprehensive approach to integrating your financial life, an investment manager might be a better choice for you.