You Deserve Better: What You Should Really Expect From Your Financial Advisor

CHAPTER 1

Are You Getting

What You Deserve?

Be a yardstick of quality. Some people aren’t used to an environment where excellence is expected.

—Steve Jobs

I can’t believe that you’re calling me back so quickly, Todd. You do know that it’s seven thirty p.m., right? You should be with your family!

It’s true—a client called my office after business hours and I returned the call that night. Not every call requires this kind of attention, but my policy is that when a client calls with a serious concern, I try to answer them before they go to sleep that night. The research is clear enough—stress can reduce our lifespan. We all know too that money is one of the greatest causes of stress—so why would I allow any of my clients’ questions about their money to go unanswered overnight?

This is just one example of my personal commitment to providing superior service (Four Seasons service, if you will) to all of my clients. This laser-like focus on the needs of my clients is exemplified by THREE GUIDING PRINCIPLES that my employees and I follow every day. They are:

1. What am I doing to help my clients today?

2. What am I doing to improve the business so that I can provide my clients with better service today?

3. What am I doing to improve myself so that I add more value to the business and can do a better job for my clients today?

As you can see, each of these guiding principles begins and ends with a single goal: to do something every day that is, ultimately, of direct benefit to my clients. Many days, what this looks like in practice might be something as fundamental as communication—returning client calls promptly, or maybe reaching out via phone, letter, or e-mail, simply to catch up, to discuss any potentially concerning major US economic news, or to check in if I sense something isn’t right closer to home.

Other days, I might call on my twenty-year background in software development to create and leverage technology that helps me monitor my clients’ accounts in ways that almost no other advisor can. I’ve designed custom software that I run against all the activity on my clients’ accounts to identify potential areas of interest or concern. I know the first time they use their debit card, and I’m aware when they write a check for an amount that is greater than normal. With this level of monitoring and service, I can call up my client and say, Hey! I see you used your debit card for the first time. You’ve never used it before, or I’ve never known you to write a check for over $5,000. Is everything okay? Was that you?

Said another way, I look at everything I do through the prism of what I would want if I were on the other side of the desk.

I also think of the things the typical financial advisor does:

✔Is my client using their money wisely and enjoying it fully?

✔Will it last as long as they live?

✔If they have more than they are ever going to spend, are we doing enough for their heirs?

But unlike many financial advisors, I am also thinking beyond my clients getting what they deserve financially—I aim to give them what they deserve emotionally, too.

Far too many times, I’ve heard of situations where an investor says, I didn’t call my advisor because I know he’s really busy with his other clients. There is danger in that. You have an advisor precisely because you want to make decisions with someone educated at your side. I am at your side. You deserve to have an advisor who treats your financial picture—and its inherent emotional components—with respect. The first step toward discovering and building a long-lasting professional relationship with your financial advisor is understanding what you deserve. There are certain standards you have a right to hold your advisor to, and the right advisor will gladly discuss and uphold these standards.

The first step toward discovering and building a long-lasting professional relationship with your financial advisor is understanding what you deserve.

It’s true, we all have busy lives to lead, and sometimes it’s convenient to comfort ourselves with the old adage No news is good news. If we aren’t hearing from our lawyer or our tax specialist or our financial advisor, we assume we are in good hands. We also often make certain assumptions about the kinds of things that our trusted professionals are doing for us when we’re not with them, but are our expectations in line with what typically happens?

5 EXPECTATIONS

EXPECTATION #1

Advisors spend the majority of their time managing investments.

The reality is that up until very recently, the vast majority of financial advisors made their living from commissions, which often meant they needed to spend the majority of their time on the acquisition of new clients and the generation of investment transactions. It can be to your advantage to have an advisor who works on a fee basis, and is therefore more focused on managing your assets than on transactions that generate commissions. Because a fee-based advisor is compensated according to the amount of assets under management, his income is based on how well he manages your money—talk about a built-in incentive to create a win-win situation! A fee-based system can also remove potential conflicts of interest, keeping the focus on you and not on any given product.

As a fee-based advisor, I sustain my business and provide for my family not based on the transactions of the day, but by paying attention to my clients’ portfolios and financial goals. My calendar is not filled with appointments to sign up new clients every day. To the contrary, my calendar is filled up with whatever my clients need me to attend to. In a nutshell, a fee-based advisor like me doesn’t get paid big commissions up front. Instead, we have to earn the right to help you work toward your goals every single day.

EXPECTATION #2

Advisors will treat me like an individual, not like a number.

Over the years, advisors have developed many models to use as a basis for managing their clients’ assets—all their clients’ assets. This means that too often all clients with a given investment objective or risk tolerance end up being asked to sell everything they own so they can purchase shares of x, y, and z (so that they are invested according to the advisor’s model), regardless of what they already own or want.

VanDenburg Capital Management does not subscribe to this one-size-fits-all mentality.