The Value You Pay For A Financial Adviser - YouTube

I’m Brady Plunkett, an Associate Portfolio Manager at PWL Capital.

I want to tell you why you’re not getting what you’re paying for in your financial

advisory relationship.

What “financial advisors do” doesn’t at all correlate with what the financial services

industry is often all about.

In fact, we’re apples-to-oranges different in all kinds of ways.

That’s a nice way of explaining how I believe this industry has underserved Canadian investors

for a long, long time.

So, what kind of value do investors deserve to receive if they decide to hire and work

with a financial advisor?

Stick around and I’ll explain.

Why would YOU want to hire an independent

financial advisor?

Instead of placing some products inside your investment accounts that pay advisors large

commissions who will send you on your way, an independent advisor should have an entirely

different focus on your total wealth picture - not just the increase or decrease in value

within your RRSP or TFSA over a certain time period.

But also - things like your insurance coverage, retirement plan, and your wills & estate planning

documents.

Your average financial salesperson often centers on selling you their own in-house investment

products, one transaction at a time.

There’s not much regard for how each product fits into your long-term financial planning.

It could perhaps have even come from a company-wide effort to launch a new product they’ve developed

internally.

What I’m telling you is with a fee-based advisor, the aim is very different.

The objective is to shift your attention away from simply chasing raw returns and establish

a more meaningful relationship with your money.

Of course, investment returns matter.

But fixating on them as your greatest goal is not only nerve-wracking, it can be counter-productive.

Remember, outperformance in excess of a market index is NOT a financial goal, but rather

a human emotion.

Deep down, I think most of you already know this.

You probably already suspect there must be a better way to earn respectable returns … and

get on with living the rest of your life.

There is!

It’s called evidence-based investing.Fee-based advisors should not be required to sell you

any particular products to meet corporate sales targets in order to keep their jobs.

These advisors do not spend a great deal of time SELLING in their conversations with clients.

As crazy as it might sound, fee-based advisors aren’t too focused on the new hot-off-the-press

mutual fund, or selling you that big whole life insurance policy which you may not really

need.

Fee-based advisors are there to help you instead of trying to sell you.

Here’s a glimpse into how they might help.

First, what are your greatest financial goals to begin with?

If you’ve started to accumulate capital, then what is its objective?

Take note in the risk vs reward relationship of investing.

While many investors can become distracted by the dazzling returns (that’s the reward

part of it by the way) pay critical attention to the RISK part of that relationship.

Find comfort in your unique need, ability, and willingness to take on investment risk.

These are the sorts of preliminary areas fee-based advisors will explore.

Beyond that, the rest of their job involves tending to other details that contribute to

your financial success.

Stuff like: Ensuring you HAVE a financial plan which is

reflective of your financial goals Helping you STICK to your financial plan and

investment strategy through the years … even as the financial media continues to chime

in with their unhealthy click bait during market declines.

Fee-based advisors help you turn that radio off, close Twitter, and stay in your seat

during tough markets.

Then there’s everything else … insurance coverage, estate planning, budgeting, retirement

spending, tax management, university funding for your kids, stock options, business succession

planning … and, well, you get my drift.

All of it – integrated into your wealth strategy.

To cut to the chase, if you thought the only thing an investment advisor was good for was

to help you hit a big-time home-run in the stock market.

I’m Brady Plunkett, an Associate Portfolio Manager with PWL Capital and I hope I’ve

encouraged you to take note of a much better advisory relationship available for you out

there.

Having said that, if you’re still really enjoying your experience of paying high fees

with a manager that is promoting a new in-house product at every annual investment review

you have with them, that’s fine too!

Enjoy!

Tell us all about it by posting your comments and questions below.

I'm Brady Plunkett, an associate portfolio manager at PWL Capital