What do you do when your toothaches? You call the dentist, right? How about a time when you face a legal issue? You must surely be consulting a lawyer. What about your money? How do you plan your future financial security, your retirement, and your life goals? What about your legacy, your estate, and other money matters? Do you seek professional advice or top financial advisors or do you opt for a DIY approach?
It seems like the average American chooses the latter. According to a recent survey conducted by CNBC, about 75% of Americans manage their own money without any outside professional help. Only 17% of the remaining 25% use the services of a financial advisor.
As per the National Finance Educators Council, wrong money decisions have cost Americans more than $1,200 on average every year. While that number may not look very big, the stakes get much higher over time and with more wealth involved.
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A financial advisor provides professional financial advice to clients in return for a fee. The topics for consultation are wide-ranging and cover important areas like tax planning, portfolio management, retirement planning, estate planning, insurance, risk management, and inheritance investment.
There is empirical evidence that people are happier when their financial life is sorted. A majority of those who work with financial advisors feel financially more secure. Clearly, financial advisors play a positive role in a high net-worth individual’s life. If you want to delve deeper into this topic, and if you happen to have anywhere from $5 million to $500 million in investible assets, then we recommend that you download this guide.
For now, let’s explore how to find the right financial advisors for you and check out a summary of top financial advisor 2019. We will also answer the questions “Can I trust a financial advisor?” and “How do I find a financial advisor who is right for me?”
Summary of top financial consultant in 2019
A financial advisor should not only be able to make sound investment decisions, but also match your financial situation and goals to the broader strategy in constructing a financial plan. A one-size-fits-all approach does not work in financial advisory. Each client’s situation is unique and, therefore, a different set of actions.
There are thousands of financial advisors in the US. Below, we have listed a summary of top financial advisor 2019:
Pzena Investment Management
Pzena is a New York-based financial advisor with $32 billion in assets under management. It has more than 250 client accounts and 23 years of experience under its belt. Pzena Investment Management manages equity-based portfolios for foundations, pension plans, and individual investors. Interestingly, Pzena Investment Management has offices outside the US as well, with Melbourne and London being its international locations.
Highland Capital Management
Highland Capital Management is a Dallas-based investment management firm. It specializes in alternative investments, private equity, hedge funds, and structured investments. It has close to $5.5 billion in assets under management.
The company’s client base includes retail investors as well as institutional investors. Highland Capital Management has only 40+ client accounts. Additionally, the firm’s core strength includes investment management. It has capabilities in managing equity, real estate, high-yield credit, special situations, and sector-specific investments.
Pillar Wealth Management
Pillar Wealth management is a unique financial advisor that takes its quality of advice very seriously. It is the reason why the firm will accept only 17 new clients in 2020. Pillar Wealth Management, LLC. is a fiduciary that works 100% on fees, and personalizes wealth management to the needs of its high and ultra-high net worth clientele.
The firm has some important achievements to its name in terms of successfully meeting its clients’ short, medium, and long-term goals. The co-founders bring in over 60 years of combined experience which allows Pillar Wealth Management to offer a complete suite of services for meeting the needs of any high-net-worth individual.
If you are wondering how we are on this list even if this is our blog, we encourage you to download our guide: The Ultimate Guide to Choosing the Best Financial Advisor: For Investors With $5 Million to $500 Million in Liquid Assets today. You will get insights into what sets apart a top financial advisor from an average financial advisor.
GW&K Investment Management
GW&K Investment Management has, perhaps, one of the highest assets-under-management. It manages close to $40 billion across 37,500+ client accounts. The company’s clients include individual and institutional investors. GW&K is positioned as a volume player. The company is based in Boston and has been in business for 45 years. The primary philosophy of the company is built around asset diversification. GW&K specialized in equity and bond investments.
If you want to know how to find the right financial advisors for you, you need to think about some important factors.
Firstly, you need to find an advisor, who will not just make investments for you, but look at your entire financial situation holistically. Once a broad picture is established, you need the advisor to make decisions that fit your purpose and goals. And finally, you want the advisor to constantly monitor your situation and periodically update you.
You will be surprised to know that many big-name financial advisory firms simply make investments and then forget about it.
The ultimate goal of the financial advisor is to help you fulfill your life goals. In order to do so, it is imperative to be aware of how your portfolio is moving towards that goal. To develop this awareness and to quickly take any corrective actions, it is critical to get quarterly or monthly reports from your financial advisor. Not only do such regular updates keep you up-to-speed, but they also demonstrate that your financial advisor is also deeply involved.
Secondly, you want to work with a financial advisor who is ethical and acts in your best interest. You should inquire if a prospective financial advisor, whom you are evaluating, is a fiduciary. A fiduciary is an investment advisor who is registered with either the SEC or your state’s regulator.
It is the duty of a fiduciary to always act in the best interest of the client and to inform the client whenever there is a conflict of interest. You can ask a financial advisor for his/her registration number and then cross-check the qualification on the National Association of Personal Financial Advisors (NAFPA) website.
Thirdly, you want to find a financial advisor who not only focuses on portfolio returns, but also the costs of managing the portfolio. The costs can, in fact, be quite significant. For example, if your financial advisor regularly churns your investments and switches from one stock to another, you will frequently pay short-term capital gains tax.
Short-term capital gain tax rates are higher than long-term capital gain tax rates. Secondly, certain mutual funds have a higher expense ratio than comparable alternatives that charge only a fraction of the fees.
So, controlling the costs of your investments is just as important as the returns that those investments generate. We recommend that you read this book on improving portfolio performance for anyone who has $5 million to $500 million in investible assets.
Can I trust a financial advisor?
It is natural to have the question of “Can I trust a financial advisor?” in your mind. After all, money matters are very personal. Therefore, if you are going to allow a professional financial advisor to manage the important decisions related to your hard-earned money, then one key ingredient is essential – trust.
In a world where the use of technology and low-cost index funds are growing every year, financial advisors play a bigger role than simply managing investments. Financial advisors need to understand the motivations, the financial goals, and the requirements of each client.
Once that understanding is established, financial advisors are then expected to demonstrate their ability to offer advice that allows the client to reach those goals. In other words, the advice has to fit the requirements of the client.
In order for you to feel confident about a financial advisor, you need to trust that the financial advisor will meet all of the expectations listed above. The best way to find out whether you can trust a financial advisor is to speak with the advisor one-on-one.
Simply reading online reviews or blogs won’t establish trust. Trust is a human emotion and it needs to be felt. In order to establish trust, you need to feel convinced about a financial advisor’s working philosophy, processes, and track record.
When you meet an advisor, you should try and delve deeper into the passion levels of the advisor. If the advisor is motivated to grow wealth and help you reach your goals, then that is a positive sign. You also want to see a degree of promptness and persistence in the way the advisor works.
Do they reply to your phone call or email on time? Do they follow up on your meeting with phone calls and demonstrate that they want to help you rather than simply add another client?
Secondly, you want to hear the advisor speak about investment planning, tax optimization, and how he/she can save you money while growing your portfolio. That will show the depth of knowledge and experience that an advisor has. It will also show the passion that the advisor has about financial planning.
Thirdly, as pointed out earlier in the article, you want the financial advisor to be a fiduciary. This point is a clear-cut non-emotional way of establishing trust. Fiduciaries have their official registrations on the line when they act in your best interests. They are bound by their fiduciary status and will give you the confidence that they will not do anything to harm you.
Ultimately, you want to feel knowledgeable, empowered, and positive at the end of your meeting with a financial advisor. There is a high chance that you will trust a financial advisor who will give you those impressions. If you want to meet a trustworthy ultra-high net worth financial advisor, then schedule your free consultation. You’ve got nothing to lose.
There are thousands of financial advisors in the US. So, the question then becomes “How do I find a financial advisor who is right for me?”
This is a valid question and one that is facing many high-net-worth individuals throughout the US. The following are some tips that can get you started:
The first step is to know yourself. Make a list of your goals, important events, how you spend your money (or will spend), and what you want to do with your wealth. For some, donating for a specific cause is a priority.
For some others, sending their kids or grandchildren to an elite university is a dream. Also, think about what kind of lifestyle you want to sustain in the future. All these points should be clear in your mind because they will deeply impact your choice of a financial advisor.
The second step is to start looking for qualified and experienced financial advisors. Qualifications can be designations like CFP or CFA, a certain minimum number of years of experience, and/or a decent educational background. You should also pay particular attention to the array of services that a financial advisor offers.
Every financial advisor may not be an expert in all aspects of financial planning. For example, if inheritance planning is important to you, then make sure that your selected advisor is experienced in that area or can bring an expert as part of the service offering.
The last step is to actually speak to your shortlisted advisors. When you speak, evaluate the interest, passion, and working style of the advisor. Explore if you can establish a good working relationship with that person. Also, make sure you ask the financial advisor about the fee structure.
You want to know whether you will pay hourly, as per milestones, or a commission. Some CFPs follow a hybrid model which is a mix of two structures. Clarify if there are any other extra fees/charges and whether the fees include taxes.
Hutch Ashoo and Christopher Snyder are the expert founders of independent, fee-only, and fiduciary wealth management firm Pillar Wealth Management. If you would like to speak with them or simply ask any questions about how custom and trusted wealth management advice is offered to high-net-worth individuals with $5 million to $500 million in investible assets, then feel free to start a conversation.