NEWS & RESOURCES

The financial services industry has changed a lot over the years. The traditional model of investment management is falling short of meeting clients’ needs. There has been growing distrust of the industry thanks to the 2007-2008 financial crisis, confusion over the many tax credits available following the COVID-19 pandemic, complexity of rules and regulations and too much ambiguity about service costs. In addition, with the growing evolution of technology making it faster and easier to get basic advice online, why would anyone work with a financial advisor today? The short answer is customization, the depth of knowledge and the value of services provided far exceed other available do-it-yourself options.

Every financial advisor is different, and you’ll find some do or do not charge hourly fees for financial advice. The practice of modern financial planning in 2023 should charge an annualized percentage based on your assets managed on your behalf.* As your assets grow, the fee associated will most likely reduce at specified thresholds. A smart financial advisor should understand you work hard for your money, and they should help make what you earn work harder for you.

In doing this, a financial advisor aims never to charge more than the value their clients receive – focusing on that value mirroring in your returns. If you’re wondering if working with a financial advisor in 2023 is right for you or if you’re looking to switch advisors, here’s an overview of what should be included in the percentage they charge you and should be inclusive of the following invaluable services:

Financial Strategy: Identification, prioritization and mapping to financial goals; portfolio design, fund selection and asset allocation.*

Tax Planning: Collaborating with your CPA. Staying up to date on ever-changing tax laws and legislation, regular conversation and review of your current tax liabilities to ensure you’re taking advantage of available benefits.

Optimization & Management: Regular portfolio rebalancing, proactive tax-loss harvesting, biannual strategy reviews and revisions.

Behavior Modification: Ongoing advice to avoid financial mistakes, accountability to stay on plan and achieve goals.

Preparedness: Planning for broad family and business needs, including insurance, estate planning and succession planning; referrals to a network of other trusted professionals.

Situational Guidance: Advice to navigate significant life circumstances, including changing jobs, buying a home, marriage, divorce, death or caring for an aging parent.

Expertise: Educated, experienced, fully licensed advisors certified to provide financial advice; robust knowledge of the economy, market, investment products, taxes, business operations and more.

Support Staff: A team of sharp, responsive, caring people available to answer questions and who are dedicated to your success.

Many companies have attempted to calculate a quantifiable value for today’s financial advisor – ranging between 1.5 - 3.0%, according to studies conducted by Morningstar, Vanguard and Envestnet. Whichever research you go by, it far exceeds the percentage charged.

Holistic financial planning is not the same as investment management. If your financial advisor solely feels like an asset manager, many of the above services would not be delivered. That means, they might not be the right fit if you’re looking for a financial partner that can offer you a wide range of services. If you want someone on your side, offering clarity, confidence and a roadmap to future goals, then it’s wise to look for a financial advisor that practices a holistic, goals-based model.

*This fee applies to all managed accounts. Mutual funds and insurance policies are commission based, paid either by the client or insurance carrier. *Asset allocation does not assure or guarantee better performance and cannot eliminate the risk of investment losses.