The World of Financial Advising With Dutchess Partners

When I started working, I never in a million years thought I would need or should have a financial advisor.  I just figured all I needed to do was not spend more than I make.  The reality though is that life is hard – no matter how much you do or don’t make and the struggles of yesterday are nothing like the struggles of tomorrow.

I have fond memories of living a good life with my parents when I was younger.  They didn’t have much money – not much at all.  Yet we were still able to go on vacation, camping in our tents and we were still able to do things like amusement parts and movies every now and then.  But their phone bills weren’t $400 for a family of 6; and internet (non existent back then) and TV (what we didn’t pay for tv – no cable) weren’t a huge expense either.  My grandmother never understood how our first starter home which was only 600 square feet cost us $75,000 and that was almost 30 years ago.  She would always say her first home was $6,000…  Life was very different back then.

Nowadays it seems daily living costs have sky rocketed as well as taxes, taxes and more taxes.  It isn’t always as easy as not spending more than you take in.  One medical surprise or one major home or car disaster and any one of us could be in a situation where we cannot financially recover.

These are all reasons why we ALL need a financial advisor.  We are all advised to keep at least 2 1/2 months of salary in the bank.  I don’t know anyone who has been able to do that.  Even in you can – we have found ourselves in situations two times, that we had no control over, where we have had a financial catastrophe far greater than 2 1/2 months of salaries.  No one can plan for something like that – fortunately we had been investing and planning for a future.  We just need to start that plan all over again.

So now that we have determined that everyone should have a financial advisor or at least consult with one every now and then – what do you look for in one and what questions should you ask?

What do you need help with? How Can Dutchess Partners Help?

• Marriage
• Kids
• Retirement planning
• College planning
• Adult dependent assistance
• Eldercare assistance

That list is just a sampling of the financial changes that can occur in a persons life.  For us, we are now in a situation where we need to plan for the last two – Adult dependent assistance for our special needs son who just turn 18 as well as eldercare assistance for my mother in law who lives with us.  If we try to do all this on our own, we will naturally have our emotions built into the process.  A financial advisor helps to remove the emotions and make investment decisions.

A financial advisor can help develop an investment plan and when you have questions, they can help you stay within your investment plan or strategize needs and how to change it.

If you are an entrepreneur, business owner etc… who may have unpredictable or cyclical streams of income it is even more important to have a financial advisor who can help get you through the slower periods.  A landscaper, mason etc., already know times will be tough in New England from December through March.  Proper guidance to plan for those tough periods is crucial.

Additionally, none of us want to just plan for the next disaster.  We all have dreams, goals, bucket lists, and even retirement to plan for.  A financial advisor can help set goals, develop that financial plan and help hold us a bit more accountable for financial decisions.

Financial advisors are experts who provide financial services and/or guidance to their clients.  They help people manage their money with appropriate products and services that will best meet their clients needs.  They can help clients find the right portfolio of investment products based on a proper, acceptable level of risk.

So once you have a financial advisor – because now we all know we need one…

Questions to ask your financial advisor

• What is your education level?  Have they completed all the essential coursework?  Have they taken more than they need to?  Does it seem like this financial advisor really enjoys what they are doing and is passionate about helping others?
• What licenses do they have?  Do some research on what those licenses mean and allow them to do.  It may mean that particular license uniquely qualifies them for your specific circumstances.
• How much experience do they have?  I always compare this to a brain surgeon.  If you needed a brain surgeon how much experience would you want that person to have to operate on you?  Well, set that same expectation to your experience with a financial advisor.  Is it five years?  ten years?
• Are they are fiduciary?  You want them to be – at least I would want them to be.  This would require them to act in your best interest.   They would not be able to make a decision with your assets that would put their commission above what is in your best interest.
• Is there a minimum fee?
• Is there a minimum portfolio size?
• Specifically what services are offered and options?
• How is the financial advisor paid?  Do they earn commissions?  I actually think they are required to disclose up front if they earn commissions but you should ask just to make sure.
• What is their billing frequency?  Will you be getting billed monthly, quarterly or will payments be through your investments.
• How much input will I have into asset allocation of my portfolio?  How much risk tolerance am I willing to accept.  There are general guiding principals based on your age and/or circumstances but still – you should have control and ultimate decision making over your portfolio.
• Is your advisor alone or do they belong to a team like Dutchess Partners?  This is helpful so you know if you will have as much access as possible to your investments or will you need to wait three weeks while your advisor is on vacation?
• What is the termination clause in our arrangement?  We always want things to work out but what if it doesn’t?  What if I no longer want a financial advisor?

What other questions can you think of to ask Dutchess Partners?