to have a good guide in your corner and seek the advice of a qualified advisor to bring discipline and clarity to your investment plan. You have only one investing life cycle and hiring a professional to guide you on this journey is the pru -dent approach for most. Once you’ve made the decision to work with an advi -sor, the question becomes, which type of advisor should you choose? The two basic options: a retail advisor or an inde -pendent, fee-only advisor. What’s the difference? tive to give anything but their best advice. An independent, fee-only advisor is free to set their own compensation (fee schedule) and is often significantly less expensive than a re -tail advisor. When it comes to investing, you get what you don’t pay for – lower fees will translate into a higher rate of return for you. RETAIL ADvISORS Retail advisors are often licensed brokers or certified finan -cial planners and you can find them at your local financial institution or mutual fund company. They often sell a limited range of products – only those approved by the firm. Costs are also an issue because they are usually high – often two to three per cent annually of the value of your investment portfolio. That’s excessive. It can also leave you with limited choices. It’s similar to shopping for a car and walking onto a Ford dealer’s lot. Chances are you’ll be driving out with a Ford. The same is true with retail financial investments. FEE-ONLY ADvISORS Alternatively, fee-only advisors are usually independent and can have access to a wider variety of cost-effective invest -ment solutions. Independent, fee-only advisors’ financial goals should be more closely aligned with their clients’ be -cause they are generally free from the conflicts, constraints and pressures that retail brokers face. They have no incen -When it comes to investing, you get what you don’t pay for The larger the portfolio, the greater the savings. The fee schedule will be transparent, not buried in a hard-to-read disclosure statement, and your investments will not be locked into any deferred sales charge schedule. It’s a com -petitive marketplace and the best independent advisors add further value by providing holistic financial planning to their clients. Ideally the advisor to look for is what is known in the in -dustry as a “triple threat;” that is, a certified financial planner (CFP), an insurance expert (CLU), and securities licenced (that is, can offer a wide variety of investment choices). THE RIGHT ADvISOR FOR YOu Finding the right advisor for you is important. You don’t want to hire an advisor only to later feel like you want to make a change. Getting the right person from the start will save you both emotional and financial stress. There are two areas of “fit” that are essential for having a long-term, successful relationship with your advisor. Investment philosophy – There are many different philoso -phies for managing investments and building wealth. You want to find an advisor who clearly articulates their invest -ment beliefs and methods in an easy-to-understand fashion to make sure they align with your goals. If the advisor does not have a clearly defined view or can’t communicate it well, keep looking. Personal connection and trust – You will be establishing a close working relationship with your advisor, sharing im -portant personal information (both financial and emotion -al). To do their job best, an advisor needs to know you well. Make sure the advisor walks their talk. Finding the right advisor to work with is a two-way street – feel free to ask lots of questions and find out about the advisor’s personal background and experience. Ask the advisor who is their ideal profile? Do they have lots of clients in your profession and understand the opportunities and challenges of the chi -ropractic community? Your patients put their trust in your experience and skill to help them achieve optimal health and wellness. It’s a simi -lar relationship when it comes to wealth management. If you want optimal financial health and wellness, spend the time to hire the very best so you can enjoy the financial life you and your family deserve.• Look for Part 2 of this article in the June issue of Canadian Chiro-practor. We will examine the asset allocation decision. 24 • CANADIAN CHIROPRACTOR | MAY 2013 www.canadianchiropractor.ca
Chiropractic + Naturopathic Doctor May 2013: Page 24
