My Financial Advisor Won’t Answer This Question

by | Sep 9, 2023 | Financial Planning, Insights

A few years ago, we were approached by a new client with two questions her advisor wouldn’t answer:

  • When should I start social security?
  • My pension says I can receive monthly income or a lump sum to invest. Which is better for me?

She had worked for years with an advisor at her local bank to oversee her retirement investments, but because these questions didn’t relate directly to the bank’s products, he told her these were outside the scope of what he could help her with.

Suddenly, she felt alone and unsure where to turn before a friend referred her our way.

Unfortunately, this is a very common situation. Why? Financial advisors go by many names. Wealth manager, financial planner, financial consultant, investment advisor, and many others. These professionals often do very similar work but choose different titles. Confused yet?

We find it can be helpful to ignore titles for a moment and ask about the substance of their work, instead, with questions like:

  • What topics can you advise me on?
  • Do you help with only a few topics or can we discuss any topic together?

These are just a few of the questions we advise asking when you interview a financial advisor, but the primary goal is to find out if you have a or a comprehensive, process-based advisor or a product-based advisor.

What’s the difference?

  • A comprehensive, process-based advisor coordinates everything from the bank account to the estate plan together into a unified plan, like we do here at Alterra. Ideally, they are independent of any bank, investment, or insurance company, so that you’re receiving objective advice. They may not file your taxes or write your will, but they consider all these factors in your plan. And, more importantly, no topic is off limits from discussion.
  • A product-based advisor is generally tied to a company with a specific product. In this client’s case, her advisor was a bank representative who could only advise on bank investment products and was not allowed to extend advice beyond those strategies because the bank didn’t want the risk exposure of this type of advice. We hear similar stories when folks call their 401(k) provider, insurance agent, or investment company.

So, if you find yourself worried about a question but your advisor won’t answer it for you, you can be confident that the answers are out there…you might just not have the right advisor to provide the comprehensive approach you need.

For more on this, read The BEST Way to Build Wealth. And if you or someone you know is looking for that comprehensive, process-based approach. we invite you to learn more about How We Work!

Josh Whelan

Partner, Financial Advisor

About the Author

Josh sees his profession as a calling, not just a career. His motive for pursing financial planning was very personal. While working on a degree in marriage and family counseling, Josh’s father was diagnosed with multiple sclerosis. Josh decided then and there to change career paths to help his family prepare for an uncertain financial future. Financial planning became his path to serving others.

The “Alterra” name was coined by joining the Latin roots “alter”, the origin of the word “altruism” with “terra” meaning earth or land. This name reflects the company philosophy of “clients before profits” and providing firmly grounded advice.

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