Your new advisor will learn a lot about you and your family through your initial conversations and reviewing your account statements. Now that you’ve hired your new team, it’s time for them to get working and go beyond the financials and really get to know you, your goals, and your wishes.
This article outlines the steps that every advisor, including Glassman Wealth, should take to build the groundwork for your relationship.
Align Priorities & Needs
The first few weeks and months of a new relationship should be focused on aligning priorities and needs. Every client is different: Some are more investment-focused, and require little help with their estate or retirement plans. Some benefit more from strategies to minimize their tax burden. Others find tremendous value in budgeting, cash flow projections, and retirement income strategies. Still others need help with charitable gifting and saving for their child’s college education.
You are unique and different from every other client, but your advisors should follow a consistent process to ensure that your priorities are aligned. In the past at Glassman Wealth, we would push our list of priorities at the onset of each relationship. We realized that there was a step missing: reconciling and aligning our top priorities with those of the client. It’s important that both you and your advisor agree to the roadmap ahead at the onset of the engagement.
A significant amount of time is dedicated to gathering and organizing your personal financial information. This entails collecting your account statements, estate documents, tax returns, and insurance policies. Some of these are probably collecting dust in a drawer somewhere, but your advisor should help you organize it and provide a detailed picture of your finances.
This discussion should go beyond just dollars and cents, and into your life goals. What do you want to accomplish with your wealth?
Once your advisory team has a comprehensive understanding of your assets and financial picture, next comes a discussion of your ability to withstand the ups and downs of financial markets. A critical part of long-term investment success is the confidence that your portfolio is appropriate for you.
Along with this comes an exploration of what financial goals are within your reach, and the strategies to get there: When would you like to retire? (Often a client says, “yesterday.”) What is the best way to save for my children’s college? How can I minimize estate taxes and transfer wealth to the next generation?
This also involves projecting what will happen in a variety of scenarios. Going through the “what ifs” will help prepare you for market volatility and life events as they occur. This becomes increasingly important at various stages of your life.
Now that you and your advisor have a clearer idea of your goals and what’s possible, it’s time to review recommendations on how to get there. Once you and your advisor agree on your investment strategy, your portfolio should be rebalanced according to the plan. Sometimes the investment piece can be the easiest to implement.
Other pieces of the financial plan may need input from estate, tax, or insurance professionals. Retitling assets or drawing up a new trust takes time, as does requesting insurance hypotheticals (called an in-force ledger) for existing life insurance. You should know what’s possible to implement quickly and what will take some time.
Educate & Empower
You should know what’s in your portfolio and why. That includes having a transparent view of your portfolio’s performance at all times, and understanding the rationale for each investment. It also includes talking through your estate documents to make sure you understand what will happen when you pass away, and empowering you to ask the right questions to give you the confidence that you will reach your goals.
Your advisor should not only explain what’s going on in the world, but how it affects you and what they’re doing about it.
Monitor & Revisit
Life happens. As your life changes, your financial picture changes with it. You should get together frequently with your advisors to discuss successes and challenges as your circumstances evolve, both inside and outside your portfolio.