Monday, May 11, 2015

Is It Time to Swap Your Financial Advisor for a Financial Coach?

Is it time to swap your financial advisor for a financial coach?

Obviously when it comes to financial planning – and retirement investing, in particular – no one sets out to fail. We all want the same outcome: to be successful by making as much money as is humanly possible so that we can live the golden years of our dreams. So how is it, then, that only a tiny minority make it to this promised land in reality? The vast majority fail miserably, missing the mark by terribly wide margins.

Of course, one could cite a myriad of explanations and causes for this unfortunate situation. Personally, I believe the reasons most often cited are just symptoms of one main underlying cause. So let’s dig deeper and get to the actual root cause.

Most so-called financial advisors allow their clients to dictate how their portfolios should be allocated, down to the minutest details. On top of that, clients may call any time to mandate changes to their underlying asset mix, and most advisors willingly comply. I understand how, as an investor, this may appear as giving you control over your hard-earned money, but that’s not what this is about at all. If your advisor is letting you dictate all the details, you are on a very slippery slope.

Here’s why. As an investor, in 9.9 out of 10 instances, you’re bound to react based on something you hear or see in the media or read in a magazine or on a website – and this tendency is more rampant in today’s information age than ever before. You get excited and want to make changes to your portfolio that you perceive to be advantageous. While this is an understandable natural tendency, when it comes your investment portfolio, it is precisely the wrong move and the surest way to destroy your wealth.

This past week, one of our clients reminded me of an interesting encounter we had some years back. He wanted to change his portfolio allocations to include something that was being discussed everywhere in the media at the time as THE thing to do to hit the investment jackpot. In my professional opinion, it was a bad move so I refused to do it. Of course, he was free to move his portfolio elsewhere, and I’m pretty sure it would have been easy enough for him to find an advisor who’d do whatever he wanted. Long story short, seven years later, he thanked me for taking a strong stand to protect his investments. In hindsight, the move he wanted me to make would have been a very expensive mistake with devastating consequences to his retirement income.  

Situations like these are the reason you need what I term a financial coach instead of an advisor who will just go along and let you do whatever you perceive to be the right thing, even if it breaks the rules of prudent investing. What, exactly, is the role your financial advisor is playing? Helping you to make prudent decisions and preventing potentially destructive behavior? Or just making you happy by doing whatever you perceive to be the right move?
If you're ready to swap your financial advisor for a seasoned coach with a proven track record who will give you guidance to help  you achieve a secure financial future, visit or call 877.656.9111 right now to book your complimentary session.

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