‘I thought I had worked with wealth management teams until I spent two hours with Finucci Janitis Allen Wealth.’ (a comment from a new client)
As Theodore Roosevelt said, ‘No one cares how much you know until they know how much you care.’
Finances are highly personal because they are closely tied to one’s sense of identity, self-worth, and well-being. Engaging with an advisor creates a personal bond and that bond will only be broken if a crack in the relationship leads to a breakdown in trust. In the realm of wealth management, the decision to seek a second opinion is often a critical step towards ensuring your financial well-being and securing your future. Despite placing trust in financial advisors, there are several key indicators that may signal the need for a fresh perspective. In this newsletter, we explore the top five reasons you may want to seek a second opinion for your wealth management needs.
- Lack of Communication
The top reason why clients leave their financial advisor is lack of communication. Effective communication is the cornerstone of any successful advisor client relationship. If you find yourself struggling to obtain clear, timely, and comprehensive updates on your portfolio performance, investment strategies, or financial planning, it may be indicative of a breakdown in communication. A lack of responsiveness from your advisor could potentially hinder your ability to make informed decisions about your financial future.
- Failure to Understand Your Goals and Objectives
Understanding your goals and objectives is fundamental to developing a successful strategy. If your current financial advisor cannot tell you what your financial goals are and how you can accomplish them, they are not helping you. As life circumstances change, your financial goals may evolve. It is crucial that your financial plan is regularly reviewed and updated to reflect your changing priorities.
- Lack of Transparency
Transparency is paramount in wealth management. You deserve full disclosure regarding fees, potential conflicts of interest, and the rationale behind investment recommendations. Should you encounter ambiguity in these areas, it may raise red flags about the integrity of your advisor client relationship. Seeking a second opinion can provide clarity and peace of mind, ensuring that your financial interests remain prioritized and protected.
- Incentive-Driven Recommendations
In some cases, advisors may be incentivized to promote certain financial products or services that may not align with your best interests. This conflict of interest can compromise the objectivity of their advice, leading to sub-optimal outcomes for you. A crucial aspect of effective wealth management is ensuring that your advisor remains product agnostic, meaning they recommend solutions solely based on their suitability for your financial objectives, rather than any affiliations or biases towards specific products or provide providers.
- Presence of a Financial Plan
A robust financial plan serves as a road map for achieving your long-term financial goals, encompassing aspects such as retirement planning, investment strategies, risk management, and estate planning. Likewise, an investment plan outlines asset allocation and investment strategies tailored to your unique financial circumstances and objectives, if your current advisor has not developed or regularly reviewed such plans with you, it may be prudent to seek a second opinion from an advisor who prioritizes comprehensive financial planning as a cornerstone of their practice.
The decision to seek a second opinion for your wealth management needs should not be viewed as a sign of distrust, but rather as a proactive measure to safeguard your financial well-being. By addressing potential issues, you can empower yourself to make informed decisions that align with your long-term financial goals.
RBC Dominion Securities Inc.* and Royal Bank of Canada are separate corporate entities which are affiliated. *Member-Canadian Investor Protection Fund. RBC Dominion Securities Inc. is a member company of RBC Wealth Management, a business segment of Royal Bank of Canada. ® / TM Trademark(s) of Royal Bank of Canada. Used under licence. © 2023 RBC Dominion Securities Inc. All rights reserved.