How To Fire Your Financial Advisor │Zoe Financial

How To Fire Your Financial Advisor │Zoe Financial

When the Question Is How Not If

Over Christmas, I was back home in Nova Scotia and had the chance to catch up with a lot of people I had not seen in quite some time. During one of those conversations, the topic of money came up (as it tends to when someone is speaking with me) and one person said they would love my advice on a financial problem that has been stressing them out.

“How do I fire my financial advisor?”

This person did not want to know if they “should” fire their financial advisor. They were quite clear on the fact that the advisor needed to be fired. What they wanted to know was “how” to do it. They were looking for a step-by-step on how to fire their financial advisor and what to do with their money afterward.

I had to admit that I have no experience with the issue as I have always self-managed my finances. The more I thought about it the more clear it became why this is a stressful issue for people.

The power dynamic in an advisor-advisee relationship is tilted heavily towards the advisor. The advisor is the expert on financial matters, that is why you hired them. This can make it very difficult for some people to challenge their advisors or even ask questions about what the advisor is doing with their money.

This is an important issue and providing a detailed answer would provide tremendous value to my readers. I’ve been researching this question the past several weeks and I am pleased to present this brief guide to firing your financial advisor.

Always Follow Up

Transferring certain types of accounts, like proprietary funds, may take a while. You should follow up on the transfer after two weeks to make sure that everything got where it needed to go.

Another nice thing to do, depending on how long you were with your first advisor, is to send them a personal note about the switch. It doesn’t have to be long or particularly in depth. A simple email stating why you’re making the switch and thanking them for their work is a nice touch that will go a long way. It can sting a little bit to lose a client, so end things on good terms with a short, personal note.

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Section 2. What You Need to Know About Financial Advisors

I found this section extremely helpful. It helped me better understand the cost of financial advising and how to pick apart the good from the bad. Here are some things you can expect to learn from this section:

  1. What is the difference between fee-based and fee-only advising?
  2. What is AUM (Assets Under Management) and how much will it cost you to be advised this way? (Hint its millions of dollars… hence, why WCI created the course)
  3. He goes over how to save yourself money (doing it yourself) and how you can save money, if even after the course, you feel the need to use an advisor for a specific need.
  4. Discusses Roboadvisors and what they are and how they could (possibly) be useful for you if you require an advisor
  5. Tactics of good advisors versus bad.

Sneak Peak: If you are using a financial advisor and think you understand how they get paid, you are probably wrong. If using a fee-based advisor, it will cost you millions.

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How Do I Find a Good Financial Advisor?

First, figure out if you really want a financial advisor or a financial planner. An advisor will help you manage your investments and grow your wealth. A planner will work with you to create a budget and a savings plan, plan ahead for a major expense and set aside money for your retirement.

When you decide what kind of professional you need, ask friends, family, and colleagues for recommendations.

Then interview several candidates to find a person who you feel understands your priorities and goals.

Step 3: Request a copy of your investment records

The final step before firing your advisor is to request a copy of your investment records. You have a right to these files which have valuable information on your investing history.

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If you’re dragging your feet on this important personnel decision, here are 10 reasons that might prompt you to act. If you can relate to two or more, it’s time to move on.

1. Unprepared During a portfolio review meeting, it’s clear your adviser hasn’t done an ounce of preparation. He doesn’t remember where you left off last time, what you were concerned about, or that your mother is living with you. You’re forced to bring him along while he pretends to remember.

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