#135 - Why People In The Financial Services Industry Are Freaking Out!
It’s not a good thing when the financial services industry is freaking out.
I mean really - these are people who are giving advice to you about your finances and retirement. Does it make YOU feel good when you see them freaking out? You might be wondering what in the world I’m talking about. It all has to do with a new regulation that’s being passed regarding how people who work in the financial services industry serve their clients and customers - and the people who have the most to lose because of this new regulation are those who haven’t been doing the best job all along. So… there are plenty of people freaking out. You can get the details on this episode because I’m going to tell you about them. :)
Do you know what the term “fiduciary” means?
The new rule that’s causing such a stir in the financial services industry is aimed at making sure that people who are advising you what to do with your money are only able to directly benefit from the advice they give you when the advice is in your best interest. Serving a client in that way is serving as a “fiduciary.” In other words, these rules are trying to keep advisors from giving you advice solely because it will make them more money. That sounds like a good thing, right?
Why you should hold everything close to the vest when you begin a conversation with a financial advisor.
On this episode, I’m laying out a handful of tips that I suggest you take into consideration when you’re interviewing a possible fiduciary (financial advisor). I want you to find the exact right person, a financial artist who is able to help you reach your goals for retirement and a happy life. The first of those is that you should hold your details and your situation close to the vest at first. The reason? You want to find out from them who their ideal client is before you reveal much about yourself. When you’re able to do that you’ll know right away if they are describing you or not - and whether there could be some ways that the relationship is not a good fit. Find out more on this episode.
Has your financial advisor (or a potential advisor) jumped from company to company?
What’s the big deal if a financial advisor you’re considering has jumped from company to company? Well… it could show that the person has functioned as more of a salesperson than an actual fiduciary who works in the best interest of their clients over the long haul. It’s not the only thing you should look at but it could be a tell-tale sign. As I walk through a handful of things you should consider when looking for a financial advisor you should write down a few things so you’ll know the right questions to ask when you need to have that important conversation.
Why somebody who is providing you financial services should have an optimistic view on life.
Think about this for a minute. What kind of advice will you receive from somebody who works in the financial services industry who has a pessimistic view of the world, or of life? They may be ultra conservative (not a bad thing, but possibly not a good fit for everyone). They may not be willing to make you aware of certain opportunities simply because they don’t think it’s a true possibility. Think it through… there are lots of potential issues. On this episode I want you to follow along as I walk through some potential “red flags” when you start interviewing potential financial advisors. You can thank me later.
OUTLINE OF THIS EPISODE OF THE RETIREMENT ANSWER MAN
- [0:28] Recommended things to do in Chicago and an amazing painting I saw there.
- [2:35] Comparing the artist to the painter.
- [4:00] How do you find the artist (perfect financial advisor) to help you manage your investments?
WHAT DOES THAT MEAN? SEGMENT
- [5:08] Today’s word: Artist (when it comes to financial advisors).
HOT TOPIC SEGMENT
- [7:32] Why people are freaking out in the financial industry: new fiduciary rules.
PRACTICAL PLANNING SEGMENT
- [10:24] A few reasons you may - or may not - want a financial advisor.
- [20:25] 3 guidelines to help you identify a great financial advisor.
- [25:06] 15 questions you should use to interview a potential fiduciary.
- [28:36] Why YOU typically do a poor job interviewing potential financial advisors.
RESOURCES MENTIONED IN THIS EPISODE
Roger’s YouTube Channel - Roger That
BOOK - Rock Retirement by Roger Whitney
3-video Series: 5 Minute Retirement Makeover
Roger’s Retirement Learning Center
The Retirement Answer Man Facebook Page
www.Finra.org - type in the name - get a report.
www.SEC.gov - look up professional and disciplinary history.