June 2000

Finding the Right
Financial Advisor

© Talbot Stevens

H. Jackson Brown, Jr.'s "21 Suggestions for Success" suggests that marrying the right person determines 90% of your happiness or misery. In a similar way, an individual's choice of a financial advisor has a significant impact on their financial success or failure.

Here are some issues to consider when choosing the right financial advisor.

Products. What range of products do you want? Do mutual funds and GICs meet your needs or do you need someone with a securities license that offers stocks and strip bonds? Someone with an insurance license, or is affiliated with an insurance specialist, opens up other insurance and investment possibilities.

Advice. Do you want someone to handle only your investments or provide integrated planning to address all aspects including tax, retirement, and estate planning? The more comprehensive the advice the better.

Once you have identified which type of financial advisor provides the products and level of advice you want, interview several candidates, possibly referred from friends or affiliated professionals, and consider the following.

Professional education. What formal education and accreditation does the advisor have, and what are they doing to stay current?

Value. The financial industry is very competitive. What is their specialty? What do they do to add tangible value and differentiate from the competition?

Trust. The most important attribute of a valuable financial advisor is trust. You must know that the advisor is working hard for you and always puts your interests first.

I suggest that both spouses be involved in the final choice of who to work with, since the plan affects everyone and women tend to be a better judge of character than men.

Once you have chosen a financial advisor, don't expect them to have 100% responsibility for your financial future. No one should, or ever will, care more about your money than you do.

This is why it is important to learn some basics on your own. Become an educated client so you can properly communicate your needs and goals. This will also help in the planning process and give everyone more confidence that you're on the right track.

Communicate expectations. One of the best ways for a financial advisor to initiate and maintain a successful long-term client relationship is to simply ask at the start, "What are the three most important things that I should do as your advisor so that you will feel good enough about the relationship to tell your friends?"

It should be clear to both parties what it will take for the client to be satisfied, ecstatic, or want to move the account. Likewise, clients should clearly understand what the advisor is able and committed to deliver.

Honest and open communication is as important to successful client-advisor relationships as it is to marriages.

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