Could you possibly be treating your investments and the advice around them like a one-night stand?
Do you even know the first name of your financial advisor? Do you even have a "financial advisor"? Bonus points if you have their contact information programmed into your phone.
Funny (not-funny) as it may seem, many people aren’t on a first-name basis with their financial advisor, let alone having a long-standing relationship with them.
When I survey random people in my world about who their financial advisor is, most people spurt out the name of the financial institution that holds all their hard earned dollars, and find it difficult to come up with an actual name of a real live person. They would be even more hard pressed to get a direct number to call them, as most calls are routed through a call centre anyways these days.
I don’t condemn the employees at the big banks for one second. The corporate financial system has created a culture in which no one stays around long enough in one position at a majority of these companies. It’s a move-up or move-on out mentality. Let’s be real for a moment, we are all taking care of number one first, so naturally, if working in that environment, you would want to keep your job - so would I.
Please tell me how any financial advisor can really make an impact on a client’s financial life when every time the client walks into the same office they are meeting with a different advisor?
How frustrating for you, the client!
You begin to omit pertinent and important information every time you have a financial appointment because you know that next year when you walk into the same financial institution you will be meeting with a new advisor and you will have to explain your entire life and financial situation all over again! (And that’s assuming your portfolio is even big enough to warrant a face-to-face appointment!)
As an observer of the effect technology has on financial transaction-based businesses leaves me wondering where the quality of financial advice is coming from these days and I know this is affecting the middle-class population all over the world. Corporate ladder climbing at large financial institutions leaves an undesirable effect on the bulk of the population, which still gets most of its financial advice from the corner bank.
What’s missing? Relationships. Period.
Ok, to be fair, I can’t put all the blame on big corporate banking culture, I do know all relationships are a two-way street (yes, even marriage…so I’ve heard), and even I have clients that don’t return my calls.
The reason why being on a first name basis and developing a long-term relationship with your financial advisor is so important is because the quality of advice suffers when there is no relationship. Proper follow up goes right out the window when your account gets thrown around from advisor to advisor, and I’m not even going to touch on the proprietary investments or possible canned advice that some of these institutions actually hand out like old-hard-candy – the kind your grandma kept in her purse with tissue stuck to it.
Also, keep in mind when you are working with an independent advisor on a first name basis, as a client, you are their boss. Independent advisors typically don’t have a manager they need to suck up to, quotas they need to meet and/or they don’t have the sole purpose in life of trying to please shareholders.
Here’s the other thing. The client (that’s you) deserves to get quality advice that looks at your whole financial picture and not just the ‘transaction special of the day’. This requires the investment of time and if you find an advisor that is willing to work with you and go the distance, then your portfolio will reap the benefits of that relationship.
Oh, and by the way, no matter where your money is, whether at the corner bank lost in the black hole or with an awesome advisor, you are paying for it. You are paying for your financial transactions or investments you hold any which way you cut it, so wouldn’t it be worth your time to find an advisor that you can build a relationship with?
Important big picture advice on tax planning, estate planning, retirement planning, education planning and other products and services that the traditional banking channel does not offer is the biggest reason why you need an advisor who has your best interests at heart.
How does an advisor get to the point where he/she can recommend what is in your best interest? By getting to know you and building a relationship with you, right?! Okay, so I hate having to state the obvious, but yet, it’s obviously not obvious enough.
Quick financial fixes are like a one-night stand. Sure, they are good for today, but you’ll be paying for it down the road.
Question for you: What does not knowing your financial advisor’s first name do to your prosperity over the long run?