Episode 28 — Know Your Rights With Your Financial Advisor

Many clients don’t know what to expect when meeting up with their financial professional and simply go along with what they’re told.

However, Danielle Howard wants you to get the most out of your client-advisor relationship.

Today, Danielle breaks down the rights clients have when working with an advisor, along with the qualities to look for and the questions you should ask to find an advisor who’s the right fit for you.

In this episode, you’ll learn:

  • Why your advisor should make you feel accepted, heard, and free of judgment
  • The importance of understanding how your advisor is licensed, registered, and compensated
  • Why your relationship with your advisor should be an ongoing one
  • The rights advisors have when it comes to their clients
  • And more!

Listen now to learn what you should expect from your advisor as they help guide you towards uncovering your next best self for your fall season of life.



[00:00:02] Welcome to the Wealth Done Differently Retirement Podcast. Danielle Howard a certified financial planner shares insight into the financial tools techniques and temperaments needed to make the most of your retirement dollars and relationships. Danielle bridges the gap between Wall Street and Main Street bringing complex financial topics down to earth. Danielle will educate and inspire you as you define and refine your version of prosperity.

[00:00:35] Hello and welcome to Wealth Done Differently Retirement with Danielle Howard a Certified Financial Planner. Today we’re gonna be talking about your rights. Your rights as someone who is seeking financial advice. Good afternoon. Danielle how are you. I’m well thank you Aric. Oh man I’m I’m excited to talk about this because I like my rights I do yeah and I know you have a lot of great ideas but before we get started today if you don’t mind you said something on the last podcast that really kind of resonated with me and I think will resonate with the audience you were talking about kind of what your hopes for this podcast is and also some advice. Can you remind us of what you said.

[00:01:14] Well it’s exactly what this podcast is about.

[00:01:16] But I, I truly hope that people will glean some insight and wisdom from these podcasts about you know this retirement rewirement refinement season of life and we’re going to dig into something different every week. It might be financially technical pieces or we may delve into the quality of life in this season and I just want to make sure that my listeners don’t take any of this personally and I’m saying literally you know your financial and life situation. Everybody’s is so unique and you want your advisor to know you really well before you make any decisions on what to do with the financial tools or even as you play out you know decisions that and transitions that you are going to be going through.

[00:02:08] And with that in mind I think today’s podcast is going to meld right into that disclosure very nicely.

[00:02:17] All right sounds good where do we start today with our rights? With our rights.

[00:02:22] Yeah like you said we all want to have rights and I feel that many times when people either you know go to a doctor a lawyer or a financial advisors a profession you know there’s that deer in the headlights look. They they don’t know what to expect. They don’t know what to ask for and they’re just kind of anticipating tell me what I’m supposed to do and I’ll do it. And I really want to encourage people to say you know I do have rights and to think about what those rights are especially as you move from the accumulation phase into the distribution season. It’s an entirely different conversation with an adviser and our job and advisors job at this point should help you to you know look at those those fears or to help you savor hope and avoid regrets in life. It is so much more than rebalancing a portfolio or mitigating risk. And you want to create a vision of what’s important to you and peace of mind that you have the financial means or looking at how to be creative and resourceful like we talked about in the last podcast with the gig economy and how it can add a lot of really cool elements to your retirement life.

[00:03:44] So as you look at engaging a financial planner I want to talk to folks and just say you have the right to feel at ease accepted and heard you know you should be able to communicate freely.

[00:04:02] You should be able to ask questions you should seek to understand. And on the flip side that you are understood. So you want to work with an adviser with good listening skills not somebody that is just talking over you and telling you you know what the Alpha the beta or what you know your rate of return is this month. You really want to have conversations about what is important to you. Yeah absolutely. I think you know leading into that then you have a right to have your objectives in your life and your concerns treated with respect. And I think everyone is unique and as advisors we should not judge. I think there is a lot of shame and guilt in this industry about you know what you should have done 10 years ago or when you could have done and or what you need to do now to catch up. And I I really do not like that. I don’t like you know people feeling like they are burdened with a whole financial planning thing and and so I’ve worked very hard about letting go of my judgments because again we have a world coming at us saying you should do this you should do that. And I have worked you know diligently too on my communication skills and my listening skills. And just. After being in this business for twenty three years I have heard so many different stories and I just I love that each person out there has their own unique story. There’s aspects of it that’s working for them. There’s aspects of it that they may want to consider changing but it’s not my job to tell you what to do it’s neither device’s job to tell you what to do. It’s the advisors job to help you uncover your next best self.

[00:05:58] So you have that right to be treated with respect sounds good. You have the right to feel like you know, Confidentiality is paramount in an adviser’s office. My office is in a really small town.

[00:06:14] I work with a lot of people so I know a whole lot of information. This is really intimate territory and I think that you know if you’re out and about you’re an adviser talking about stuff. You know that might not be the right, right fit for you because you’re your personal life needs to be protected in a variety of ways. I do think it is really important that couples work together. I know I again I think it’s a team approach when I work with spouses or partners so that’s confidentiality needs to. I don’t keep anything from each other. They need to be in the office at the same time. I think that’s really important.

[00:07:01] I think it’s important that people understand and have full disclosure by the adviser as to how you’re licensed, how you’re registered and how you’re compensated.

[00:07:13] You know there’s so many different ways to do this business nowadays there’s still folks out there that get commission there are they’re selling product, while there isn’t anything inherently wrong in that.

[00:07:25] You know I think people have a right to know. Do you represent a specific company an insurance company or a product line. And if you are looking for investment advice you need to be licensed and registered with the state and the S.C.C. even if you’re not managing mallet money or selling products and most of us that are giving financial advice holding ourselves out as a registered investment advisor or a registered investment advisor rep that there will be  a disclosure is called an ADV Part 2 which is a document required by the Securities and Exchange Commission. That kind of outlines how we do our business. There is a code of ethics and a privacy statement. So I client a prospective client you may you may want to ask questions such as Do you work as a fiduciary. You know a fiduciary is a person who works in the client’s best, best interests. They are not just trying to find a standard of appropriate you know appropriate product that would fit for a client. I think fiduciary is a word that’s been thrown around a lot but it’s something that people need to understand what that truly means. Right in my mind. I think there’s a lot of different levels of fiduciary you know when I look at just personal relationships it’s like what does it mean to truly have somebody else’s best interest in mind. That’s multifaceted. There’s a lot of layers to it and I think even asking you know So you’re a fiduciary what does that mean to you. And how is that going to work for me? in that light I’ll lines up with what kind of services are you providing what’s included. How do you create a financial plan. What’s the cost. How comprehensive or in-depth is this. What is the timeframe that we’re going to be working together. How do we implement this this plan. If there are products or are there are additional pieces that need to come into play. Do you refer those out do you do those in-house. Yes. All of those moving parts are all really good questions that should you know you should feel like you’re getting good answers for and that they that resonates with you. Absolutely. So once you do have all of that full of full disclosure and you understand how somebody is compensated are you going to get you should get you have a right to a written contract that spells out the terms the you know the scope of service as to how you’re going to be working together or are you just going to be focusing on you know planning for your kid’s college education? are you going to include you know your estate planning and legacy planning and cash flow planning? So there’s a variety of different services that could be offered but you want to make sure that you receive a written contract that clearly states out the, the terms and the scope of service that you’re going to be working with and that you know you either you or the planner could discontinue that relationship if it’s found to be inappropriate or unsatisfactory. What’s what’s the exit strategy if necessary.

[00:10:48] Yeah I mean you have a choice. Right.

[00:10:50] Right. And even when you’re in the midst of things you know you may go well this, this I thought it was a fit but it isn’t a fit.

[00:10:57] And what what needs to happen now you have a right for written recommendations that are based on your individualized priorities and perspective. Many times I think people you know they want an adviser. They want somebody to give them advice but unless it is based on what’s important to you your priorities your values system the vision of your future that you’re trying to create you’re not going to take that advice. So and it may be in on advisor that needs to tell you is willing to tell you some tough things whether it’s around you know how you’re how you’re spending your, your debt or that you’ve got these, these financial goals that are out there that may not be in alignment with where you’re headed and what you’re currently doing in there may be some challenging you know choices to be made. And that but if you know to have an advisor who is really going to walk alongside you to say what’s the trajectory change that you need to make if this is truly truly important to you you know. So I think that that written recommendations isn’t just based on. OK here’s a rate of return that if we can accomplish this rate of return you’re going to get to this goal in this many years. I think it has to be much more robust than that.

[00:12:23] But I think you have the right to clear explanations as to the recommendations that are being made.

[00:12:33] A big part of what I want to do is to educate my clients. So if you are working with an adviser you should expect that they are going to educate you and whatever that means. If you need to ask clarifying questions if you need to go home what type of a learner are you? Are you visual or auditory or kinesthetic. What type of learning environment is going to help you to make the decisions about what would be the next best step in implementing this plan. Needs to make sense for you based on you know your values Danielle I think it’s so important to really kind of circle back around to one of the other rights that you spoke about with this one in mind.

[00:13:20] And that was a written contract which spells out the terms of your working relationship which is beautifully said because the fact that that’s exactly what it is. It’s a working relationship. However. You and I both know and we’ve talked about this a lot on the podcast. It is about the personal relationship as much it is as it is about the professional relationship and getting clear explanation explanations as to the recommendations that they’re making. That means I should be able to ask you any question that I want. Any concern that I have I should be able to bring up and we should be able to have a conversation about it without me feeling like you’re rushing me out of your office and so on and so forth. And I know that’s what one of the things that you do really really well with your clients is that you take that time so that they understand everything that you’re talking about. They’re able to ask the questions they’re able to bring up you know other things that they’re thinking about and you just have a good time with them sitting there discussing their possible future or things that they’re trying to accomplish. And so I think that that brings it right back to the relationship piece you spoke about the working relationship earlier. I think that’s such a big part of the personal relationship really plays into being allowed just to have a conversation.

[00:14:30] Right. And it’s not all about the numbers. And I think that you know a really creative financial adviser that is truly sitting in a fiduciary capacity is going to be looking much broader and they are going to try to look at how do we can be resourceful and creative. So if you have a client who has a goal of travel but they don’t have enough you know in their retirement account to kind of accomplish what they feel they want to. That’s really important in their life. You know am I as an advisor willing to come to the table and go. Have you ever thought about the gig economy and about maybe some creative ways of doing this. How would you feel about opening up your home or you know to bring some creative and resourceful ideas to the table that would be in alignment with what the clients desires goals that idea of living a life of your full potential and just getting outside of the traditional box of what I think most people think a financial adviser is is all about and that’s this whole field of financial life planning which is so much more robust than the traditional Yeah. Here’s your MapQuest to that line in the sand retirement’s time here’s what you do Yeah. In order to get there because it is so much more than just the goals it’s all the transitions and the the life stuff that we didn’t plan on happening. That that happens and also you know depending on the type of engagement you have with an advisor is it for just a short amount of time to come up with this plan or is it ongoing. And what does that and what does that look like. So for you to really be reflective of what what you want do you just want a product. Do I just need a a life insurance policy. Well that may be an entirely different relationship than somebody who really especially as you embrace this this distribution phase this aging process you know it is it is just full of transitions and the more and more I work with clients that the more my eyes are open to just how challenging and beautiful it is and it isn’t just a static you know. Here you go see ya goodbye. It’s it’s it’s much more it’s like this river that’s running outside my window it’s constantly moving it’s constantly changing and you’ve got gotta deal with whatever shows up you know in a in a client’s life at any given time.

[00:17:17] Yeah absolutely.

[00:17:19] All right what’s the next right.

[00:17:22] I think I’d say we talked about the explanations and recommendations so that education in the education and empowerment. I think you have it right. OK so this gets to the implementation of a plan. You know I could deliver a plan and say here is all. Here are all the things that you need to do based on what’s important to you based on the the future that you’re creating. And you can walk out the door but are you going to move forward with that. Are you going to consolidate your all of your IRA’s into one portfolio and to change the beneficiary designations on those insurance policies after you went through a divorce or are you going to get that estate plan put into place or are you going to you know look at what it’s going to take to go back to school to educate yourself to move into that new career that you’ve been thinking about. I think it’s really important that you have somebody who’s going to help you with that implementation part of it. And there may be you know many pieces of the team here. There may be a CPA attorney or retirement coach. There’s family members involved with this. And I liken it to the question how do you eat an elephant?

[00:18:41] I like that question too. One bite at a time. That’s right.

[00:18:44] Because because it’s your financial life for most people it’s just overwhelming. There is so much to it. And I think when we can bite off one little bite what do you want to tackle for the next three months and what what baby steps you need to take and how can I support you in that and how do you want me to hold you accountable or what new habits need to come into play. Yeah. Here’s a book by James Clear atomic habits this may be a good resource for you. You know what can I do to help you implement and, and make your plan a reality.

[00:19:24] Yeah absolutely. And you can’t do that without a relationship. Yep. That’s all there is to it. I mean it’s just it’s just not possible. So yeah I don’t think that’s a huge piece. Do we have any more rights to cover?

[00:19:37] Well I think and you know ongoing Lee is this the implementation of your plan.

[00:19:43] There’s there’s something to be said about you have a right to have you know to have an advisor that is available especially as we move into and through this this aging process. What I have noticed with clients is you know I may have to have a little bit longer meetings I may have to ask some deeper questions to make sure that I’ve got clarity on you know pieces that we’re we’re looking at. I may need to ask if there’s family members that want to get engaged with this process to have that second set of ears. I may need to have a conversation again to go over something that we talked about three months ago and you know just revisit some, some concepts and some areas to make sure that people are, Are really understanding you know what’s going on or the ideas that I’m trying to get out disseminate and walk alongside clients and in putting out there for, for their plan. And I think having an advisor that’s available you know I get I’m putting out a podcast and I’m not going to be able to work with everybody out there and we are now we’ve got a team here in the office that we’ve got a lot of systems in place and, and pieces that really kind of helped me to, to focus on the client relationships. And I think that you know if I have a client that calls us up. We’re going to be available and to have that team and and working together to make sure that you get reassured and supported and educated and whatever you need throughout your engagement.

[00:21:37] Absolutely. I think it’s so vitally important especially when, when people I mean it’s their future. Right I mean that’s the whole thing. If I have a concern I want to be able to talk to the person who helped me put this together to make sure that they can say you know what. We made this plan. It’s gonna be OK. I mean just to hear that every once in a while is probably a good idea.

[00:21:54] Or there’s some things we need to look at but we’ll do this together.

[00:21:57] Yeah I know I’ve I’ve had that one. It’s constantly and there’s always gonna be a little fires to put out our little issues to address but I think knowing that you have somebody who is on your side who again is hearing you and listening to you and really you know in the boat with you as you go on down that river. Exactly.

[00:22:18] Exactly. You either, either help me help me or help me bail. Yeah or just help me enjoy the ride right hmm. That’s the other thing.

[00:22:26] Well and that’s the flip side of this is that you have rights to expect from an adviser. But I as an adviser also have rights to expect from my clients.

[00:22:38] So I feel that you know when you are engaged and working with an adviser that you have responsibilities to be diligent and conscientious and honest and forthright and you know putting everything on the table. Be prepared to discuss your financial life and in some of the feelings that go with it and, and that you should you know respond and and and be very proactive in this process because I get this is hard stuff to talk about but it’s it’s it’s truly truly beneficial your life will be richer if you find the right advisor. It’s kind of like finding the right you know physical coach or you know other people that you would have in your life to kind of get you to your next best self. You can either do it on your own or you can put it on autopilot. Whatever happens happens. But if you truly want to excel and feel fulfilled in life you’re gonna have to bring different team members to the table to maybe push you a little bit to encourage you to support you and to keep you on the on the track that you’re wanting to go and I think it’s the same with this retirement season. It isn’t just about OK you know withdrawing from from the world and sitting back and holding a cocktail in your hand sailing off into the sunset.

[00:24:07] Yeah. Do you remember Ron Popeil. you know I do remember. I. The name sounds familiar.

[00:24:13] Okay so he made the Showtime Rotisserie grill and he had also he also had hair in a can. You got to see that I remember you remember that. OK so. So his whole thing with the Showtime Rotisserie grill was all those infomercials. He would he would say set it. And then the audience would say forget it. So the whole thing would set it and forget it. Listen. Retirement is not a rotisserie grill. No you can’t. You can’t take a plan and set it and forget it. It is something where you are very engaged. I know you’re engaged with your clients and so I want to ask you a question if you have a client that after you go through all this they’re just not engaging you and they’re just not participating in an active role. What do you do.

[00:24:54] I start with asking some questions you know what am I not hearing or what do you think is holding you back. And you know sometimes it’s just it’s just frustrating and there have been a few times where we just have to say you’re not ready for this. I try to make it very clear upfront this is work on your part. You need to be ready at least for a journey of financial health. You need to be ready for this. You need to be you know mentally prepared especially when you’ve got a spouse or a partner that is going to be part of this. You both have to be willing and able and ready to engage and climb in the boat because this is is a lot of I’m again I’m guiding you I’m not doing all of this for you. Yeah absolutely. You know so there’ll be times when you know is there a way I could communicate differently. Is there something that I’m missing here. Is there an element that we need to address before we move on. And sometimes that will clarify things. There’s other folks that you know we we we plug through this. It’s painful on both of our sides and we get to the end and we say our goodbyes and there’s then a few that we just decide that the time wasn’t right.

[00:26:13] Yeah yeah. I mean it’s it’s you have integrity and I appreciate that about you and I know the people that are listening to this and have not met you yet they don’t know that but hopefully they get to know you because you do have integrity you’re not going to just let the client do nothing because that’s not in their best interest and I’m sure that you’ve had a few relationships because of their lack of involvement which again speaks to your integrity and your honesty about what this truly is it is some work but the reward is so great. So do we have any other rights to cover today?

[00:26:42] I think that covers that. I want to encourage people to just really look at what is changing is they move through the accumulation phase to the distribution phase you know and you know to discern whether their life warrants having an adviser and there are there’s there’s times when you know you may not need somebody that’s going to you know dig to the depths that you know that some of us life planners you know are going to go with folks and but you know as you look at what’s important to you about having an adviser to look beyond you know well yep there I see up here there are licensed and registered. But what type of advice that they can give to me and what is it based on. And is that their gig or my gig and how are we going to be able to, to work together for what’s important to, to you the client. That’s good stuff.

[00:27:43] That that is good stuff. Thank you so much for your time today Danielle.

[00:27:46] You’re welcome. I appreciate the time Aric if people want to dip their toes in the water they can check out DanielleHoward4U.com.

[00:27:57] We’ve got some complimentary webinars some educational pieces learning opportunities and then for the face to face engagement if you’re ready to go on that journey of financial health or take a look at the investment management you can get a hold of us at wealthbydesign4U.com.

[00:28:19] And if they are interested in swapping houses they should this is the last podcast.

[00:28:24] Because on the last podcast we discuss that a little bit and it might be good could talk about maybe maybe not.

[00:28:32] We’ll see. We’ll see.

[00:28:32] But thank you again Danielle.  Thanks Aric.

[00:28:35] And thank you for listening to the wealth. Definitely retirement podcast with Danielle Howard. If you have not subscribed to the podcast yet please click the Subscribe now button below. This way when Danielle comes out with a new podcast it’ll show up directly on your listening device. This makes it much easier to share these podcasts with your friends and family. And for those friends and families that need to know what their rights are. This is a great one to share specifically. Again thanks for listening today. For everyone at Wealth Done Differently Retirement. This is Aric Johnson reminding you to live your best day, every day. And we’ll see you next time.

Thank you for listening to the Wealth Done Differently Retirement Podcast click the subscribe button below to be notified when new episodes become available. The information covered and posted represents the views and opinions of the guest and does not necessarily represent the views or opinions of Wealth by Design LLC. The content has been made available for informational and educational purposes only. The content is not intended to be a substitute for professional investing advice.  Always seek the advice of your financial adviser or other qualified service provider with any questions you may have regarding your investment planning. Danielle Howard, Certified Financial Planner

is an investment adviser representative of Cambridge Investment Research Advisors a registered investment adviser. Securities offered through Cambridge investment research Inc.

A broker dealer member FINRA SIPC Cambridge and wealth by design LLC are not affiliated.




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