Signs your adviser needs to go
A strong relationship with a financial adviser you trust matters more the closer you get to retirement.
The last thing you want at this critical juncture is an adviser who doesn’t understand you or, worse, someone you can’t understand at all.
Here are five signs that it’s time to shop around for a new financial adviser.
1. Your adviser does the bare minimum.
Investing is a big part of financial planning, but it’s not the only piece of the puzzle. A good financial adviser should consider the big picture. This includes discussing strategies for claiming Social Security and pension benefits, minimizing taxes, and estate planning. Your financial adviser also should be willing to coordinate with other professionals you work with, such as an accountant or estate planner.
2. You don’t fall within your adviser’s niche.
If you are upper middle class, you don’t want an adviser who mainly works with ultra-wealthy clients. If your adviser’s clientele skews younger, you may want one who works with older adults as you approach retirement. “With younger clients, we are talking more about accumulation strategies,” says Jason Jager, founder of Jager Wealth Management. “Once you are nearing retirement, there is so much more that comes into play. You need a distribution strategy.”
3. It’s a relationship of two, not three.
A huge red flag is a financial planner who addresses only one spouse — typically the husband. “Some advisers choose one person in the family to communicate with, and they don’t acknowledge the other person’s feelings, needs or goals,” says Karen Altfest, executive vice president of Altfest Personal Wealth Management. This can leave the excluded party unprepared to handle the finances in the event of death or divorce, with their retirement goals ignored.
Trust your gut if you leave a meeting feeling uncomfortable. If your adviser fails to
4. You have an uneasy feeling.
provide detailed information about your investments, is evasive or discourages you from having your partner or another trusted family member involved, you should be concerned, says Kathleen Burns Kingsbury, KBK Wealth Connection, which trains financial advisers.
When you call your adviser with a question, you should get a response in a day or two, with everything explained clearly. “If your adviser is tripping over his words, if he refuses to tell you the costs associated with your portfolio, if he is not sending you statements regularly, ask more questions. A true professional won’t mind,” Altfest says.
5. You feel ignored. Your financial planner should check in with you at least once or twice a year, or when something significant happens, like a change in tax law. You also shouldn’t have to repeat yourself.
Kingsbury and her husband switched from an adviser they had worked with for several years because they felt he wasn’t listening. “We kept saying the same thing over and over again, and we just didn’t feel heard,” she says.