Financial Advisor?

I’ve had this topic on my list since the beginning of this blog, but never got around to writing it until I was reminded of it when speaking with a friend who is retiring soon. She and her husband have been investing on their own and have been successful at it, but were concerned about managing their investments, pension, and social security as a complete portfolio. That’s something a financial advisor is an expert at.

I first connected with a financial advisor way back in my early 20’s through a roommate. Nothing major back then, but it was the start of a conscious effort to save for the future. Not being into investing in stocks on my own, having funds managed by an investment company was my best option. If you are into day-trading or playing with stocks, you can continue to do that and still work with a financial advisor. A good one will incorporate that money into your overall portfolio plan.

While dealing with my parents’ declining health and preparing legal and financial documents, our attorney suggested a financial advisor he worked with to help with my parents’ estate. He looked at not only their assets, but ours as well, and provided guidance on managing everything as a single portfolio. This was a new concept for me and required a lot of selling to my dad, a Depression era baby with a distrust of “lawyers and bankers”. The goals were pretty simple though:

• Ensure their money lasted to provide the care they needed

• Preserve and protect as much money as possible

• Combine their estate planning with our financial planning

• Projections for our retirement

• Align and tune our portfolio – including 401ks, projected pensions, and social security to provide a complete view of all assets and coordinate them based on our life goals

All of that took a lot of pressure off us regarding how to proceed with all the pieces of the puzzle, and it is what made early retirement possible for me. We review the portfolio and our goals a few times a year, and as I got closer to retiring we started to tweak the mix accordingly. Over the years we’ve become friends with our advisor and our meetings are social calls as well as business discussions, frequently over pizza or bagels and coffee (pre-Covid that is).

Whatever your financial goals are, a financial advisor can help. If you are so inclined, here are a few tips on how to find the right one for you:

• Speak to at least 3 that are recommended to you by trusted friends, co-workers, or relatives – referrals provide better sources than a random web search – and evaluate not only the advisors but the portfolio options offered by each firm

• A good financial advisor will start by asking a lot of questions to determine your life goals and then discuss how to align your portfolio accordingly

• Make sure your financial advisor is a fiduciary, meaning he/she works in your best interests, not the investment firm’s

• Make sure you understand the fee structure: commissions, flat transaction and/or management fees, fees as a percentage of assets, etc.

• It’s your money so you need to feel comfortable with the advisor you choose and with the options available through his/her firm

I will not pretend to be an expert on investing or on recommending a financial advisor. I do however highly recommend working with someone you trust and are comfortable with to align all of your financial resources. That is what enabled me to retire at 55. No matter what your financial and life goals are, working with a trusted financial advisor to create a coordinated portfolio across your assets will help you reach those goals with peace of mind.