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Knowing more makes you stronger

The question: Is it important knowing about your financial matters before you meet your financial advisor?

The answer is YES!!! There are at least 4 important reasons why you should know about your financial situation. At the end of this post, we will also discuss how to get that valuable information.

Financial advisors work for banks, brokerages, asset managers, and other financial institutions. They are not doctors. They do not swear “first to do no harm.” Financial advisors are in a difficult situation. They do want to take care of their customers, and yet they are employees and must take care of their employers. What would you do if you could sell a product with a bigger commission for yourself and profit for the bank or sell a product with a lower commission but a better result for your customer? Would it be more important for you to meet your private/professional goals or your customer’s goals? Financial advisors, like insurance salespeople, always have the dilemma of giving priority to themselves, their employer, or their customer. It is not an easy situation. That’s why the first reason to know about your financial situation is to be able to ask appropriate questions.

Financial advisors work 40-60 hours a week. That is not enough time to know all the financial details of all their customers. They prepare well, but often the standard solutions must be enough just due to the time limitations. What that means for you is that you may not be offered a customized solution for your unique situation but, instead, an average solution that fits the average customer. This is the second reason you should know about your financial situation because the standard solution may be a mismatch. Knowing why it doesn’t fit regarding timing, risk, or return allows you to ask for alternatives that fit better your situation.

The third reason you should know about your financial situation before you meet your financial advisor is that you can get more out of the meeting. Knowing more allows you to cut to the chase and make the meeting fruitful for both you and your financial advisor. There is no need to know all the bank’s financial products when you know that you need a solution to save taxes because you just got a raise, and that puts you in a higher tax bracket, for example. Your situation and your questions are unique, and you shouldn’t be overwhelmed with confusing and unimportant information, especially if your financial advisor is charging by the hour.

The fourth reason you should know about your financial situation before you meet your financial advisor is to profit from the meeting. It is not recommended to make a rash decision. Making a financial decision usually has long term consequences. It would be better to take time before signing any contract. This means when you walk away, you want to understand what was said and offered. This will be easier if you know what your initial situation coming into the meeting.

yeekatee was created exactly for this purpose. When you are in your social network investment group, you can learn from people you trust, pose questions and maybe even provide answers. Minds working together provide better answers and profit from collective wisdom.


Written by Therese Faessler, Founder of and SFTA Head of Financial Literacy

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