Family finances can often be an uncomfortable subject. In many homes, it’s not uncommon for one spouse to be more responsible for handling the finances and financial planning, and the other takes no role. If your late spouse handled the finances, then you may be feeling completely overwhelmed with trying to understand, and become expert in, an area that you have no interest in. Let me reassure you—you are not alone. A qualified financial advisor can help, and here’s some guidance in helping you find the right one.
First, you need someone who is willing to listen to you. If you already have a financial advisor, this is an opportunity to reevaluate if he or she is right for you – especially if it was your spouse that was the primary contact with the advisor. You are a unique individual with your own goals, dreams and fears. It is critical that your advisor be just as good as listening as they are talking. When meeting with potential candidates, keep track of how much talking do you get to do, and how much talking they do. It is important that the advisor be “interested,” not just “interesting.” Make sure they listen to you. Make sure you feel that you are important to them. If you aren’t getting this feeling, then you should interview other advisors. Your financial well being is too important to work with someone who doesn’t make you feel like less than a partner. Second, find out how your financial advisor earns a living. It’s one of two ways:
Commission-based advisers sell investments and earn a percentage of those sales from the corporation or company that offers them. This means their choices of investments for you could be more influenced by a third party than your needs or goals.
Fee-based advisers work with you on an an hourly basis as a consultant, giving you advice which is up to you to implement. Or they can manage your investments for a management fee, irrespective if your account balance goes up or down. Their motivation is to keep you happy by providing good service so you keep your account with them. And they’d also prefer to see your account balance grow so that they can earn a larger fee. Thus, generally speaking, the interests of a fee-based adviser are aligned with your own.Let me be very direct about the role of a financial adviser in your life. Your money is your money – not the adviser's money. If you are not comfortable with your adviser for whatever reason, then you should end the relationship and switch to another one. Make sure they listen closely to you, communicate clearly with you, and make you feel like you are being well taken care of.
As a financial adviser for the last 14 years, I have worked with clients at both ends of the spectrum. I’ve met clients who are really interested in their finances and those who have no interest at all. The moments that I have found most personally rewarding are those in which my team has been able to look a widow or widower in the eye and let them know that, financially, they are going to be okay – That financially we are going to take care of everything for them and that their job is to take care of themselves emotionally. I wish you the best of luck in finding that right adviser for you.