Is Your Financial Advisor Meeting Your Needs?
When it comes to building wealth, planning for retirement, or achieving any financial goal, working with a financial advisor can be incredibly beneficial. These experts can guide your investments, help with tax planning, and provide valuable insights to ensure you’re on track to meet your objectives. However, not every advisor-client relationship is a perfect match, and sometimes it’s necessary to make a change.
Common Reasons for Switching Advisors
According to research from Morningstar, there are six primary reasons clients part ways with their financial advisors:
- Quality of financial advice and services (32%)
- Quality of relationship with an advisor (21%)
- Cost of services (17%)
- Dissatisfaction with returns (11%)
- Preference for managing their own finances (10%)
- Poor quality communication (9%)
Breaking Up with Your Advisor: A 5-Step Guide
If you’ve decided to leave your financial advisor, Facet, a financial planning firm, has compiled a five-fold guide to help you navigate the process:
1. Put Things in Perspective
Remember that switching advisors is a business decision, similar to changing hairstylists or gardeners. You’re paying for a professional service, and if you’re not satisfied, it’s time to move on.
2. Notify Your Advisor
Politely and respectfully inform your advisor of your decision to leave. Keep the conversation brief and professional, and ensure you have all necessary documents and account details in hand.
3. Review the Paperwork
Check your agreement documents for any outstanding fees or charges. If your advisor holds any of your assets, transfer them to yourself or your new advisor, taking care to avoid any tax consequences.
4. Reassess Your Financial Situation
Take this opportunity to reevaluate your financial goals and situation. Consider your options, and interview several new advisors before making a decision. Be sure to discuss your risk tolerance with each potential advisor.
5. Look Forward to a Better Plan
The ultimate goal of working with a financial advisor is to have peace of mind. With a new advisor, you should feel confident in your plan, even in uncertain market conditions.
Finding the Right Advisor for You
If you’re unhappy with your current financial advisor or seeking a new one, SmartAsset’s free tool can match you with up to three vetted fiduciary financial advisors in your area. Take the first step towards achieving your financial goals today.
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