The Car Conversation after the Meeting
By Katherine S. Newton, CFP®, ChFC
I’ve oftentimes wondered what my clients, especially the new or prospective ones, have to say to each other in the car after they leave my office. There’s no way to know for sure, but I imagine the conversation might go something like this:
“We just gave her (or are considering giving her) our life savings. I got a pretty good feeling that she knows what she’s doing. But did we cover all the bases? Do we know…
“...what exactly is it that she will do for us?”
Your financial advisor should tell you exactly what her services are and what you will get after you become a client. For example, if she does a financial plan, what kinds of information should you expect to see? What questions will it answer for you? Will she summarize it, and if so, how? Will she implement the plan, and if so, what needs to happen for that to occur? And as she manages your money, how will the results be reported, and how will she put that information in context so that it makes sense to you and to your circumstances?
“…how she will charge us?”
Does she strictly charge fees, and if so, for what services? How much and when will you pay those fees? If she earns commissions, will you know when and how that occurs? Is everything transparent so that you understand what you’re paying, or will it be a “smoke and mirrors” situation which may make it difficult to know what it’s really costing you?
“…what her background, designations, licenses, and registrations are?”
A designation such as Certified Financial Planner™ requires extensive study and holds the designee to a higher professional and ethical standard. Also, certain qualifications have to be met regularly to maintain the designation. In addition to knowing if she is a CFP®, do you know if she is an Investment Advisor Representative versus a broker? It makes a difference whether she is in a position to be advising you on your personal financial matters or whether she is simply positioned to sell a product. New regulations now draw a distinct difference between the two.
“…whether we are comfortable with her values?”
What kinds of activities does she participate in outside her profession? How is she involved in the community, and what does that say about her level of commitment? How does she spend her time when not actively engaged in her profession? How if at all does she display balance in her life?
“…who her other clients are, and whether we are a good fit for her practice?”
Did a friend refer you, or did she offer to put you in touch with other clients so that you could ask lots of questions about their experiences with her? Do those other clients have something in common with you and your situation?
“…how she does her job, and how we will know that she’s on track with managing our finances, and what exactly is supposed to happen next?”
A good advisor will tell you exactly what your next contact with her will be. She should have systems in place so that future activity and contact won’t be haphazard or happenstance or only as a result of you contacting her. Initially some type of communication should confirm your new relationship. You should know what to expect, too, regarding other correspondence you will receive. You should know just what information she needs from you to do a financial plan (she will do a financial plan before she does anything else, correct?), and when you are set to meet next. You should know how often you will hear from her, and in what manner, whether through an in-person meeting, phone call, or email.
The “Car Conversation” can be one of the keys to a successful financial future. Make sure you are covering all the bases and considering all the angles before engaging in one of the most important relationships of your life.
Required Disclosures:
The views are those of Katherine Newton and should not be considered as investment advice
or to predict future performance.
Past performance does not guarantee future results.
All information is believed to be from reliable sources.
However, we make no representations as to its completeness or accuracy.
Please note that neither Cetera Advisor Networks, LLC, Carroll Financial Associates or any of their agents or representatives give legal or tax advice.
For complete details, consult with your tax advisor or attorney.
Investors should consider their investment objectives, risks, charges and expenses associated with municipal fund securities before investing. This information is found in the issuer's official statement and should be read carefully before investing.
Before investing, the investor should consider whether the investor’s or beneficiary’s home state offers any state tax or other benefits available only from that state’s 529 Plan.
Katherine Newton, a 30-year veteran of the financial services industry and Certified Financial Planner™, crafts protectorates for her clients’ wealth so they have
confidence to pursue what’s most important in their lives.
You can reach Katherine at her company Waite Financial in Hickory at 828.322.9595
or by email at .
Her registered branch address is P.O. Box 1177, 428 4th Ave., NW, Hickory, NC 28603, 28601.
Registered Representative offering Securities offered through Cetera Advisor Networks, LLC. Member FINRA/SIPC. Advisory services offered through Carroll Financial Associates Inc., a Registered Investment Advisor. Waite Financial, Cetera Advisor Networks, and Carroll Financial Associates are unaffiliated.