Will Your Advisor Survive a Market Meltdown?
ATLANTA, October 21, 2014 – There’s an old saying among stockbrokers. “A good market covers a multitude of sins.”
This generally meant the stockbroker could make a few bad recommendations and not lose clients, as long as the general market trend was up and other recommendations were going up with the market.
Watch out though if the market went south and the clunker investments were exposed. As far as brokers are concerned, in a falling market, poor investments stand out on the monthly statement like a flashing red light.
Enough of those and the broker will lose clients fast, and consequently his job.
Similarly, a good market covers a multitude of investment advisor/client relationship sins. Clients are willing to overlook deficiencies in their relationship with their financial advisor as long as the monthly statements are showing good results. When statements show up with negative numbers for any length of time, the unreturned calls and generally poor treatment become magnified.
Often, the only reason for staying with an otherwise unsatisfactory advisor – good performance – “falls” away.
If this sounds like what you’re experiencing with your financial advisor, here are five things you should know about dumping your advisor and finding a better relationship:
- It’s easy to switch advisors! Even though Wall Street isn’t eager to tell you this, it’s relatively easy to go from one advisor to another. You just have to sign some paperwork.
- Most advisors will be happy to give you a free second opinion on your portfolio and how your current advisor is doing. After you’ve had a chance to find some new candidates, just put your most recent statements together for them to review.
- You can interview potential new advisors just like you’d interview a new employee. After all, you’re hiring them to do a very important job. Don’t worry about tough questions, advisors are expecting them.
- Once you decide on a new advisor, they will handle most of the transfer process for you. They’ll also give you advice about which investments would be better liquidated and which investments should be “transferred-in-kind”.
- There is no need to have a confrontation with your current advisor – unless you want to! You don’t even have to speak with them. Everything can be done by signature with your new advisor. Your current advisor won’t even know you’re making a switch until he receives the paperwork.
So if you’ve been hanging on with a financial advisor you’re not happy with because his investment performance has been pretty good, the recent market pull back might be the perfect time to reassess your advisor and make a change if warranted.
Dave Dickinson and Delwin Holeman saw that many investors faced a problem when they wanted to leave their financial advisor. Investors felt that it would require a confrontation, so they would often decide to just stick it out and hope for better results.
FireMyAdvisor.com was created to spread the word that leaving an advisor can be easy to do. The website educates people on what qualities to look for in an advisor so that their choice of a new advisor is better suited to their needs.
Dave Dickinson, firstname.lastname@example.org, 850-270-6359