7 Signs It's Time To Find A Different Financial Advisor In The New Year
Your financial advisor should be a trusted source of clarity and confidence in your financial future.
But not all financial advisors will be the best fit for helping you achieve your specific goals.
Here are seven tell-tale signs you may need a new financial advisor in 2023.
1. They Aren't Prepared For Your Meetings
First and foremost, you want to work with a firm that genuinely cares about you and your goals -and knows what they are in advance of meeting with you so they can help you prepare! Your advisor needs to devote the proper amount of care and attention to helping you achieve them.
One way to assess how attentive they are is by paying attention to the care they give to meeting with you. If they don't remember what's going on in your life or seem scattered during calls, they may have taken on too many clients or just don’t consider you a top client. This could be a sign that they aren't the right fit for you.
2. You Haven't Reviewed Tax Planning Strategies
At Covenant Wealth Advisors, we're firm believers in the power of proactive tax planning, especially for those on the cusp of retirement.
You and your advisor should build a tax plan and review it often to ensure you're making the most of the opportunities available to you. This may include Roth conversions, managing your tax bracket, withdrawal plans in retirement, maximizing credits and deductions, charitable giving, and ongoing investment efficiency.
Refer back to point #1. Your advisor won’t know which strategies may apply to you if they don’t know you and your goals. A simple way to gauge this is to think about the last time they asked you for a tax return.
3. The Fee Structure Is Confusing At Best
You should have a clear understanding of what you’re paying your advisor. The world of financial fees can be challenging to navigate, especially if you're working with an advisor who isn't upfront or transparent about their fees.
That’s why we're committed to being honest and straightforward about our fee structure as it helps develop a foundation of trust.
The way you pay matters just as much as how much you pay. Covenant Wealth is a fee-only independent firm, meaning we only receive payments from our clients and not from referrals, commissions, kickbacks, or other third-party sources.
This structure minimizes conflicts of interest and helps us serve you best.
4. You Don't Know If They Operate In Your Best Interest
This might seem obvious, but you can’t assume your advisor is putting you first. That’s why it’s important to work with a fiduciary.
It's easy to cast off "fiduciary" as just another financial buzzword, but it carries significant weight and meaning, especially to us.
Fiduciary status is a legally binding oath that signifies operating at the highest level of care, something we do daily. You should ask if your advisor is a fiduciary and have them sign a statement saying so.
5. Their Advice Doesn't Seem Comprehensive (And Custom)
Any financial advisor will talk to you about your investments. Most will even help you understand the best investment strategies to meet your needs and discuss their investment philosophy and how it will help you.
But a good financial advisor does so much more than investment management. They understand how investments support retirement income and how to piece it all together with other sources. This includes your Social Security benefits, pension, annuities, real estate, and any others you may have.
You also want an advisor who looks beyond investments at your entire financial picture. This includes insurance, tax planning, estate planning, risk management, cash flow planning, and life transitions.
You don’t have tunnel vision regarding your future, and your advisor shouldn’t have tunnel vision for how to support it.
6. You're Not Really Who They Want To Work With
Financial planning isn’t a one-size-fits-all service. Money is complex and different at each stage of life, and many advisors have specialties that reflect that.
For example, if you're a pre-retiree it might not make sense to work with a firm specializing in college planning.
Look for advisors with qualifications and specializations that meet your needs. At a minimum, this means your advisor should be a CERTIFIED FINANCIAL PLANNER™ practitioner. If you’re nearing retirement look for specialized retirement credentials such as the CFP® and CPA designation. Partnering with financial advisors who have both of these designations can be tremendously helpful.
This not only shows they have the expertise to help you but the desire. The last thing you want is an advisor who is only taking you because you are willing to pay them!
7. You Don't Align On Communication Styles
Regardless of how good your advisor is and if they work with other people like you, it’s critical that you are on the same page regarding communication. Whether that’s in person, virtual, frequently, or just once a year is all a matter of preference. The important thing is that it’s effective.
This includes when times are good and bad. How they treat you when times are rough is telling of a firm's character. Do you feel ignored or unheard? These things matter!
Work With A Firm Who Wants To Serve You Best
If you’re interested in working with a firm that puts you first and provides you with peace about your financial future, call us today.
At Covenant Wealth, we specialize in helping individuals and families 50 and older achieve their retirement planning and investment goals and are ready to start working for you.
Want to see how we can help? Request a free retirement consultation today!
Author: Mark Fonville, CFP®
Mark is a fiduciary, fee-only financial advisor at Covenant Wealth Advisors specializing in helping individuals aged 50 plus plan, invest, and enjoy retirement without the stress of money.
Forbes nominated Mark as a Best-In-State Wealth Advisor* and he has been featured in the New York Times, Barron's, Forbes, and Kiplinger Magazine.
Disclosures: Covenant Wealth Advisors is a registered investment advisor with offices in Richmond and Williamsburg, VA. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital. The views and opinions expressed in this content are as of the date of the posting, are subject to change based on market and other conditions. This content contains certain statements that may be deemed forward-looking statements. Please note that any such statements are not guarantees of any future performance and actual results or developments may differ materially from those projected. Please note that nothing in this content should be construed as an offer to sell or the solicitation of an offer to purchase an interest in any security or separate account. Nothing is intended to be, and you should not consider anything to be, investment, accounting, tax, or legal advice. If you would like accounting, tax, or legal advice, you should consult with your own accountants or attorneys regarding your individual circumstances and needs. No advice may be rendered by Covenant Wealth Advisors unless a client service agreement is in place.
Registration of an investment advisor does not imply a certain level of skill or training.