By: Brandon Harvey, Founder / Family Wealth Advisor, Legacy Wealth Management Group
For those of you who know me well, you know I spend a fair amount of time in social settings—whether it be an investment conference, catching up with a friend over a bite, or meeting a client referral for the first time. No matter where, I come across the ever-inevitable question about what it is I do. Now, fortunately I adore my profession so much that I am more-than-happy to expound the many wonderful things I do for my clients. (Maybe this is less-fortunate for whomever happens to be my company.)
What I find particularly fascinating, albeit sometimes awkward, is the exchange that takes place next. While most don’t come straight out and say it, their next thought is rather obvious, “Am I rich enough to actually need the services of a financial advisor?”
For many, they would definitely benefit from a relationship with an advisor, although to what extent can differ greatly. What I find key, is that with technology and the resources available, there is no reason to feel around in the dark.
While not all-encompassing, and while many will find they have not followed these steps, here are some examples of how to utilize an advisor in different stages of life:
· Get ahead of the game: Early in your career, you should consult with an advisor to figure out saving methods, utilization of the different types of accounts, and begin implementing ideas. This type of relationship is most likely to declutter the sources of advice and build trust in anticipation of greater needs. Many advisors will consider charging on an hourly consulting basis or even waive a fee altogether as an entry point to longer-term business.
· Re-evaluate what is important: As we get older, people tend to go through major life events that create complexity in the financial picture. At this juncture, goals tend to shift more toward large expenses like home purchases and the funding for children. Planning becomes more important, and depending on how busy a person is, the relationship with an advisor could move toward offloading some of the investment management.
· Line it up: As you get closer to an impending retirement, the timeline for savings and growth is no longer on your side. Major decisions on what sources to draw income from and when, how to stretch assets through the possibility of a longer life, and how to manage standard of living including healthcare become imperative. An advisor should work with you to plan and implement a drawdown of assets with a higher sensitivity for risk.
· Prepping for handover: Late in life, you should have a clear definition of what the estate will look like, and how those assets will transition to heirs, charities, etc. At this point in a relationship, an advisor should work through the plan with your heirs and help to provide clarity as to how an inheritance or the expense of a death may affect their overall picture.
I’ll come out flat and say it, I find the title “wealth management” to be a misnomer—as it implies a certain level of assets and often keeps those who could benefit from advice from seeking it. As unnatural as it may seem, don’t minimize your own needs and self-qualify based on assets.
Much of the time, the relationship with an advisor is based on changing circumstances in life, and altering plans based on those changes. If you are currently working with a service that doesn’t strike you as a resource, there are plenty of other options available, from self-management to full-service “wealth management”.
Where do we go from here? This is the February 2019 volume of a monthly blog series where I’ll be sharing insights and education from actual experience in working with clients. This blog is designed to reduce the complexity of managing your finances and provide transparency into how I work with you, my valued clients. I look forward to connecting with you here. Feel free to email me with your questions or comments at firstname.lastname@example.org give me a call at (415)966-1133.