How To Know If You Are Working With The Right Advisor

Your financial advisor plays a key role in your life. They help you use your financial resources to craft a plan that embodies your goals, dreams, and aspirations. That is a big responsibility. Entrusting a professional with your hard-earned money is no small feat, and you deserve to be working with a team of professionals who knows you and cares about your success. 

That’s the experience we strive to provide our clients. But not all firms are built alike, and each may offer different services or ways of working that suit some people better than others. 

What should you look for in an advisor? 

You know how they work

Ways of working, processes, and systems can be an overlooked factor when working with an advisor, but this is an important part of your relationship with them. It illustrates how they operate as a company and the way that they will work with you on your needs. 

Here are a few questions you can ask to better understand how the advisor structures their working relationships:

  • How often will we meet?
  • Who will I work with?
  • What is your communication style and when will you contact me about my plan?
  • How do you approach adjustments/additions to my financial plan?
  • Will you look at my plan in a comprehensive way?

Your working relationship with your advisor sets the tone for your experience with them. Are they comfortable using virtual/digital technology? If you are a more hands-on person with your finances, for example, finding a collaborative advisor would be key. 

We know that no two people have the same financial needs. That’s why our financial planning system is built to construct a tailored approach to your financial well being. 

This strategy allows us to get to know you—goals, dreams, and priorities—as well as your financial picture like your retirement goals, financial strengths, and areas of improvement. Our financial planning is built on commitment and trust.

Their pricing is fair and transparent

Pricing is one area in the financial planning industry that can be confusing. With so many different ways advisors get paid, it can be difficult to know exactly what you are paying and the level of service you receive for that price. 

Before working with an advisor, be sure you understand their fee structure. They should be able to clearly illustrate their system so you know exactly what to expect each billing cycle. There are a few different fees to know about:

  • Fee-only. Fee-only is a broad characteristic that means the advisor only gets paid from client services, not on the sale of products. Fee-only includes a myriad of other fee structures like flat fee, hourly fee, assets under management (AUM), and more. 
  • AUM. This fee is taken as a percentage of the assets we manage for a given client. It is a common fee-structure that you will encounter when looking at investment and wealth management. Note: advisors who charge an AUM can also be fee only! It’s just a specific way of structuring those fees.
  • Commission. Advisors who operate under this model can receive a commission for a financial product or service they recommend. 

Before working with an advisor, you want to make sure that you understand not only their personal fees but any other costs associated with the investment tactics and strategies they use like mutual funds, exchange-traded funds (ETFs), or other investment vehicles. That way you have a complete picture of the fees you will incur.

They operate in a way that enhances your goals

Comprehensive financial planning is an important part of what we do, because we know that finances don’t operate in a vacuum, they each play off of and affect the others in unique ways. Your investment plan, for example, isn’t just about your expected returns. For an investment strategy to work for you, it has to be tailored to your needs and goals. It has to take into account your time horizon, risk tolerance and liquidity needs, asset allocation, tax efficiency, diversification, and your personal goals. 

There are so many aspects that go into making a financial plan great. It is important to work with someone who wants to enhance each and every aspect of your financial life. 

Ready to learn more?

Working with a financial advisor is a personal experience. Find an advisor who works to establish and maintain trust. You will have greater confidence knowing that they are on your side and want the best for you. Are you interested in learning more about our financial planning philosophy and how it can better serve your needs? Get in touch with us today.  

Wood Smith Advisors, a woman-owned Registered Investment Advisor (RIA), is a fee-only financial services firm that partners with its clients to simplify their financial lives. We focus on women, entrepreneurs, and individuals with complex financial situations, providing objective and competent advice, education and services to help them develop and build their businesses and reach their financial goals. We can be reached by clicking here.

"Finance Made Simple" blog posts are intended for educational purposes and not for specific advice. Each person’s situation is different. Consult your financial advisor for advice relating to topics discussed.

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