First time visiting a Financial Advisor and not sure how to handle? Winnie Sun shares the misconceptions and what not to say when meeting with a financial advisor.
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SPEAKER: Number one thing not to say: “Do anything you want; I trust you”. Although as a financial advisor I certainly can appreciate that you can trust me, it is very important that you remember that you are the CEO of you finances. And so take the opportunity that you have with me to learn about investing and financial planning, Take the opportunity to soak this all in and get a good feeling about the terminology and understand what it is you are doing. Because when you understand that you can quantify whether or not you are being successful, or whether or not you need to make changes for your financial plan. And the better relationship you have with someone like myself, the better relationship we will have, the better long term relationship we will have.
The second question you don’t want to ask your financial advisor is to come in and say: “what is your performance? What can I expect on my portfolio?” Think about it, depending on when you invest what you risk tolerance, how long you have until you need the money is completely different. It is impossible to give true, accurate information. Instead you should focus on risk tolerance, you should focus on your immediate planning goals and we can look at historical performance to give you a good feel if had you invested in this particular portfolio back at a certain point this is what of performance you can expect. But with that takes a lot more information and a lot more time spent together.
The third question you should not ask your financial advisor is: “Will I get tickets to the Super Bowl or what else will you do for me if I am your client?” Remember your financial advisor is to help you get from point A to point B financially. We want to be there to help you with your financial plan, take care of your investments, and the things that matter most, your serious investing. Unfortunately, we are not your bookie. So to think about us that way doesn’t really work. In addition, this will prevent us from giving you large gifts.
The fourth question that we get asked all the time is: “who else do you manage money for?” The reason why it is not a good question is because, based on client confidentiality we are actually prohibited from sharing that information with you. If our clients do decide to share that information with you, and how they investing and what not, that is their right to do so. We prefer as professionals to have some discretion. Just like your personal OBGYN or your attorney, we are bound by that same rule of confidentiality. Number five thing not to say to your financial advisor: “I was introduced to you from so and so and I want exactly what you have done for them.” Now, unless you have been cloned magically or are the exact same person as your friend, it is a really bad idea. Because it is life experiences and as time arrives in risk tolerances and so many other factors that we call the: “know your client rule”, that pertain to how we manage money. So it is really important that you spend time with us so that we can get to know you and your tendencies and your preferences and all those thigs that you would just talk to a good friend about to give us knowledge that could build the ideal portfolio for you.
Number 6: “How busy are you, because I want to make sure that my financial advisor is always available 24 / 7?” That may not be the best solution for you and perhaps you would want someone a little more seasoned, a little bit more in demand and a little bit more experienced. Because often when you do walk into a financial advisor practice and you look for the person with the most time on their hands, they tend to be a rookie, or there could be other factors that you don’t know about. Instead look for someone experienced, someone you trust and someone you could have a long term relationship with and certainly we will make plenty of time for you.
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