Two weeks ago, I was in Washington DC speaking to a CEO roundtable. At the end of my talk, one of the participants said to me “I am sure you are worth every penny you charge, but I have been ripped off by a financial advisor and don’t know if I can ever trust another one. Do you have a case study on how to recover from a bad advisor?”
Great question. If you don’t want to be ripped off by an advisor or the financial system in general, you first have to start thinking about these things differently. Finding the right advisor is about personality, communication and knowing what you need. Do you need a wealth advisor to assist you in creating sustainable wealth? Or are you your own wealth advisor, and just looking for some special expertise in a narrow discipline?
Most of us are unknowingly looking for wealth advisors and hire specialty advisors. Let me explain.
Here’s a common scenario. I need tax advice, so I seek out a tax specialist, i.e. a CPA. My need for insurance is met by a specialist – my insurance agent. My new will is drafted by my legal specialist – my attorney. My investments are handled by another specialist – my stock broker. Question: Who is handling my wealth?
We treat all these facets of wealth management as separate…and they’re not. Creating sustainable wealth is most effectively done by beginning with the end in mind – the end being the freedom that comes with planning for a prosperous future.
If asked “Do you want to leave a legacy for your children?” your answer might be “Yes, absolutely.” But what if funding that legacy means you have to shave 10% off of your annual spending? Is that really what you want? The answer may still be ‘yes’, but without looking at the whole wealth picture, you would not have considered all the consequences to answering one narrowly focused question.
A good wealth advisor begins the process with a plan. He or she may call it a financial plan, a wealth plan, or in our case, The Prosperity Experience®. This plan is not a one-size-fits all; it must be tailored to meet the goals and intentions of the client. It includes a decision-making model that supports the person or couple in reaching their full wealth potential.
Specialty advisors like insurance agents, investment advisors and estate planning attorneys are brought in as needed to provide detailed expertise in a focused area. The wealth advisor may have these professionals in-house or they may be available via contract. Either way, the wealth advisor coordinates their work and uses the planning process with the client to facilitate decision making.
If you have been ripped off, there is nothing to do but get back on your horse and begin again, with the wisdom you gained from the experience. Take it slow. Trust your intuition. Do your homework. Find out who you are talking to.
Sustainable wealth creation is a lifelong process. While no single decision may change the trajectory of your wealth and prosperity, any single decision can. Don’t wait until you have made that one big, bad decision to begin again.