Who is your Financial Advisor?
Who is your Financial Advisor?
Being in the industry and observing advisor-client relationships from up close, I have experienced a fact that never stops to baffle me. What advisors really are and how they are perceived by their clients?
Most advisors in the industry, unfortunately, know no better than their clients. Financial Advising is not about; knowing whether the market is up or down on a particular day, knowing the names of mutual funds, knowing insurance products and annuities. Anyone can get that information, in this age of internet and CNBC.
I encourage clients and prospects to do thorough due diligence of their existing relationship and before engaging a new one. Look at it this way, when you interview for a job, or if you are in business and are seeking customers/clients, does the other person not look for your qualifications and credentials, your capabilities, your ethics and the value proposition that you have to offer?
Why then, when prospective clients are looking for a financial advisor should they not look at these things more specifically? A Financial Advisor is supposed to be that Beacon of financial and investment intelligence that guides you to financial success. Not your social friend who is funny, entertaining and as pleasant as a hotel concierge.
Of course, a Financial Advisor should have a pleasant personality and a very pleasant disposition. But that is not the key value proposition.
Who would I want as my Financial Advisor? That is the question I asked myself, years ago, when I became a financial advisor. The answer I came up with is: Someone who is highly qualified, designations like CFP, CFA; someone who can understand and analyze your financial situation; someone who is capable of analyzing Capital Markets and Investments and in combination with this, someone who can and is committed to work hard to help you meet your financial goals.
Playing golf for years does not make one a great golfer, driving a car for years does not make them a race car driver. Why then should being a Financial Advisor for years make one an expert in investments and financial advice? It should not be the grey hair on the head but the grey matter inside it. Unfortunately, success of an advisor in this industry is recognized by how many people the advisor signs up and how much revenue the advisor generates. Not the once that are actually qualified to and do make a difference in a client’s financial situation.
How many people do you know that are financially successful because they work with a Financial Advisor? It is usually the other way around isn’t it?
