Should You Hire a Local Financial Advisor?
Proximity Offers some Potential Perks, but Service, Customization, and Expertise Win the Day
Especially for high net worth and ultra-high net worth investors, choosing a financial advisor is one of the most important decisions you will ever make. Whether searching for your first advisor or looking to replace your current one, you may be wondering if there is any advantage to finding a local financial advisor compared to one in a different city or state.
You will be tasking this person with the job of preserving and prolonging your wealth for the entirety of your life, and beyond. They will be the one who ensures you achieve every one of your most cherished goals and dreams, to the degree they relate to your finances.
With the wrong advisor, you can lose millions from overly conservative or overly aggressive investments, poor asset allocation, or no coherent or customized long term plan that can adapt to changes in your own life and in the world around you.
It’s a huge decision.
So how much weight should you give to finding a local wealth manager, as opposed to one you might mostly communicate with from a distance?
The answer is, there are advantages to both scenarios. This article will discuss both, and help you decide whether the location of your financial advisor should factor in to your decision of who to work with.
6 Reasons Why the Location of Your Advisor Doesn’t Matter
1. If the Guru Is on the Mountain, You Go Hiking
What matters more – expertise or proximity? There’s no contest here, especially for ultra-high net worth investors. You want the best. And if the best happens to be in another city or state, you do whatever it takes to work with that advisor.
Even if that advisor is based 3000 miles away – are you going to let that stop you? You need the best possible wealth manager for your situation.
How do you ascertain if one wealth manager is ‘better’ than another?
That is THE question every ultra-high net worth investor should be obsessed with answering.
Below are two resources to help answer it: A quick guide and a complete guide.
Quick guide: 10 Questions to Ask Potential Wealth Managers
2. Sidesteps the Illusion of In-Person Trust
A local financial advisor is not more trustworthy than an off-site one. Read that again, because it’s a common misconception. One thing has nothing to do with another.
Think of it this way: If a Ponzi schemer lives in Florida, and builds trust with investors in that state by meeting with them in person, what’s the benefit? He’s still a fraud.
The same holds true with incompetence, inexperience, and inferior service.
Being local offers no promise of something better. Just because you can sit down and meet face to face does not make that person more trustworthy, more credible, or more competent.
How is trust built then, between financial advisor and client?
Trust is built through the development of a 100% fully customized investment plan.
As you go through this detailed development process, and see your own personalized short and long term goals and dreams planned out for decades and funded through your wealth management plan, you will likely develop strong trust in the advisor who created it.
Initial trust is built upon understanding, communication, and by an advisor who truly listens to you. Trust grows when an advisor seeks to understand you, rather than just prescribes pre-determined investment plans, the same ones they offer to everyone else.
At Pillar Wealth Management, when you first explore the possibility of working with us, you won’t be shown a booklet with various plans to choose from that differ only in their asset allocations, labeled with terms like “aggressive” and “moderately conservative.”
That’s because the plan we create for you will be 100% unique – to you. No other client of ours will have the same plan as you. They have different life situations, different priorities, and different levels and distributions of wealth.
By not limiting yourself to just your local area, you will open up the possibility of establishing trust through a customized plan development process – a far better trust-building approach.
If the most important thing to you *IS* a customized investment plan for your portfolio, a call to Hutch Ashoo, CEO and Co-founder of Pillar Wealth Management is HIGHLY encouraged. It doesn’t matter whether you’re local to the San Francisco Bay area or across the country, Hutch has been managing the portfolios of high net worth and ultra-high net worth investors nationwide for the past 30 years.
3. Technology, Technology, and Remote Meetings
It has never been easier to conduct meetings with people in completely different places around the globe. You can have live meetings with six people, where each person is on a different continent – let alone city or state.
And with video chat and group phone calls, you can conduct these meetings and still benefit from hearing each person’s voice and seeing their faces.
So while there may be a temporary sense of comfort from meeting in person, when it comes to establishing a productive and professional relationship with a financial advisor, you can achieve mostly the same effect through effective use of modern technology.
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4. Reporting Is Done Via Email and Snail Mail
Your ongoing reports – the documents you look forward to receiving at regular intervals that show you how well your portfolio is performing in accordance with the plan – also have nothing to do with the location of your financial advisor.
You can receive your reports by email, regular mail, or through online access. In terms of reporting, there is no advantage to working with a local wealth manager.
Pillar Wealth Management is used to working virtually with their clients . And that means instantaneous communication. Since there is no obstacle or roadblock to working remotely with a financial advisor, the next step would be to schedule a call with Hutch Ashoo, CEO and Co-Founder. With his 30+years of wealth management, you can experience for yourself what it’s like to be a client firsthand.
5. Investment Vehicles Are National and International
Whether you invest in individual equities, treasury bonds, hedge funds, index funds, municipal bonds, commodities, or anything else, your specific investment options have little to do with the state where you reside.
Yes, some states offer specific services such as 529 plans, but for the most part, where your wealth gets invested and where it grows has little to do with where you live.
6. Fiduciary Advisors Custody Your Assets in National Firms
Fiduciary financial advisors do not ‘keep’ your money in some secret account like a hedge fund might. Most often, we place your assets in custodial accounts at a firm such as Fidelity.
What this means is, no matter where you financial advisor might be located, you can walk into any local branch of wherever your custodial accounts are held, if there were ever a reason to do so.
Just be aware that you won’t find any high-net worth financial advice at those locations. The people who work there are basically just tellers.
Talk to an Exclusive High Net Worth Financial Advisor
If location doesn’t matter for you, and you are a high net worth or ultra-high net worth investor looking for help, click the link below.
6 Advantages to Working with a Local Financial Advisor
1. You Can Meet them In Person
Clearly, the greatest benefit of a local financial advisor is that you can go see them in person. For matters of great personal concern, sometimes a face-to-face conversation feels like the best way to proceed.
With a local advisor, you can go see them anytime you need.
2. Easier to Accommodate More Frequent Meetings
Much of this question depends on what you need. For example, if you plan to rely on your wealth manager to direct your estate planning process, and you expect this will require multiple in-person meetings involving several different specialists, a nearby location where everyone can meet makes this simpler.
If you think you’ll need to meet with your advisor frequently and believe these meetings need to be done in person, you might want to lean toward a more local advisor.
3. Local Advisors Have a Better Sense of the Local Real Estate Market
If real estate plays a large role in your overall investment plan, and if you prefer to invest in local properties, it might make sense to get an advisor who also knows the area.
This is not a necessity or requirement of course, and again it depends on how heavily you plan to involve your financial advisor in your real estate investment decisions. But it is a strength that a local advisor may possess, that some ultra-high net worth investors may find valuable.
4. Local Advisors Understand the Local Business Market
If you’re a business owner, you may find it valuable to work with an advisor who is familiar with the local business environment.
For instance, if you plan to sell your business in the future, a local financial advisor who has experience helping clients with mergers and acquisitions will likely know some of the key stakeholders, possible buyers, and the overall business market in your area.
This kind of on-the-ground awareness can provide you with a strong advantage, depending on the nature of your business and the sorts of buyers you might be looking for.
Looking to sell your business?
Begin with this 17-point exit strategy checklist
5. Greater Understanding of State and Local Taxes
Hiring an advisor from Texas to help you minimize your state taxes in California may not be the best strategy. It’s not to say it can’t work, as the most pertinent tax information for each state will be readily available to any advisor.
But every state has its little quirks, loopholes, and death traps. When you factor in county and city taxes, sometimes that extra bit of hyper-specific awareness can give you a big advantage and help you avoid certain losses.
The more familiar your wealth manager is with local and state laws and taxes, the more equipped they will likely be to best serve your interests, as a fiduciary advisor seeks to do in all situations.
If you’re a High Net Worth or Ultra-high Net Worth Investor, at Pillar Wealth Management, we go one step further. A team of professionals are assembled around you. Experts who are on call, who understand the law, who understand specific tax scenarios applicable to you, as well as other complex and rather confusing realms of wealth management.
Our CEO and Co-Founder Hutch Ashoo will explain more when you and he talk. You can schedule a short chat with him by clicking here.
6. You Live in a Big City
If you live in a large city, you will simply have more choices.
Because few financial advisors possess the highest levels of expertise and experience in working exclusively with high net worth and ultra-high net worth investors, your choices will be limited no matter what you live.
But in a large city, you have a much greater chance of being within proximity of an advisor you would prefer to entrust with the management of your wealth.
Want to Go Local?
If working with a local advisor is a top priority for you and you live in Silicon Valley or the San Francisco Bay Area, seek out Pillar Wealth Management.
Looking for the Best Possible Financial Advisor?
Everyone’s situation is unique. No advisor is best for everyone. Pillar Wealth Management, for example, only works with clients who have at least $5 million in liquid investable assets. If you have less than that, we are not the right firm for you.
Also, if you have no interest in discussing lifestyle dreams, long term goals, or risk tolerance, and just want to focus on getting the highest possible numerical performance, we are probably not the right firm for you, because you do not view wealth or its purposes the same way we do. We consider goals and performance inseparable. This is the foundation on which we build 100% customized plans.
Hutch Ashoo, our CEO and Co-Founder can explain more when you and he have a short conversation. You can schedule a chat with him by clicking here.
That being stated, to find the best advisor for your situation, you must begin by asking the right questions. You must know what separates the few, and the very best, from all the rest.
The good news is, the resources given earlier to help find the right advisor apply to anyone, even those not bound by location. Here they are again:
Quick guide: 10 Questions to Ask Potential Wealth Managers
Fast track option:
If you want to skip all that and talk to an expert wealth manager – this week – with over 30 years of experience exclusively serving high net worth and ultra-high net worth clients, click the link below and schedule a talk with Hutch, the co-founder of Pillar Wealth Management.