To Fear or Fear NotSubmitted by First & Main Financial Planners - East Bay Area: Oakland, CA on June 22nd, 2018
We have lot of people who come to us who quickly say they wished they’d come to us many years before.
People are funny about their money and we get it. Most people don’t have a big interest in understanding their money, or how well it could work for them; they’re focused on the day-to-day, living their lives and caring for themselves and their families. That’s totally normal. It takes a leap to overcome the natural fear that many people have when the time comes to trust a financial advisor.
The fear of trusting a financial advisor is justified in many ways. The financial services industry is primarily focused on easy and profitable transactions, many of which are very obviously skewed to the benefit of the firm. We regularly see cases where clients have bought something they don’t understand. When they bought, the consequences were left out of the conversation (it’s all in the fine print but the resonant sales points were the focus).
There may be simple suitability tests that a sales person will cover in order to document the transaction and avoid litigation, but there is often not a process of discovering what is best for the client. The dearth of expertise in the personal financial services industry is breathtaking. The licensing tests needed to sell financial products are anemic, at best, and there’s no real mandated measure of competence. And why would the financial services industry want it any other way? If there were real measures of competence, and requirements for full transparency, the industry would likely be significantly smaller and less profitable than it is now.
HOWEVER, there are people in this industry who are extraordinarily bright and talented who’ve committed themselves to understanding quality and doing what’s best for their clients.
Certified Financial Planner™ professionals are held to a very high standard. The details of which can be found here: https://www.cfp.net/docs/default-source/for-cfp-pros---professional-standards-enforcement/CFP-Board-Code-and-Standards. This is not an advertisement for the CFP® standard (there are other quality standards) but the reference is meant to shed light on the fact that good people are out there and they have your best interest at heart. The sooner you find one the better off you may be, in some instances many times better off.
There are of course things to consider like experience and personality when deciding to work with a financial advisor, and there are lots of opinion about how to best solve problems, but if you start by finding someone sworn to adhere to a hard-core ethical standard the odds are in your favor.
There’s lots of science in the world of financial planning and many things which have been proven true. Find someone who has studied, practiced, and has ideas and perspective, and then engage them.
Fear not I say.