Such helpful information and thanks for the resources on how to find an advisor. I did a search recently using these networks and it was quite discouraging to see so many firms that looked very white and male dominated per their website. I am a female POC and it feels like such a disconnect. Secondly there were firms that noted that they were only currently accepting clients with 1 million in investable assets and based on referrals. Referrals are a known thing, but what if you’re the one trail blazing here and the first in your family to try and establish generational wealth. It all feels overwhelming with these barriers so I would be very interested to hear from those who have been successful with more inclusive firms. My search continues!
I get it for sure, the numbers in the industry are overwhelming male and white. But that’s not to say there are not amazing female and POC-owned out there. I’m friends with a lot of them. Perhaps, give the XYPN network another shot?
Check out hellonectarine.com - I love their concept. It’s a platform to look up financial advisors who charge a flat fee (as opposed to taking 1% or more of investments, which is common). Their roster has a fair amount of women and POC and they have several options depending on what your needs are. It’s a disrupter in the financial planning space and I think it’s neat! Gives a low cost way of seeing if you jive with someone too or just get a few questions answered.
I’m not connected or anything but Nectarine was started by @personafinanceclub on instagram , who I think has a great platform for financial basics and beyond
These are important things people don't think about when finding and working with a financial advisor! I would add that sometimes when a client isn't ready to work with a planner, it might be helpful to work with a financial counselor (https://findanafc.org/). I am currently working on my AFC and CFP certifications, but I have met many great professionals focusing solely on financial counseling.
It's such a tough process. I'd recommend starting with a few trusted professional organizations. You might try NAPFA (all fiduciaries) or the XYPN Network. You can search for local advisors or someone who specializes in your needs.
Financial advisors come in so many different flavors, and the industry doesn't make it easy for consumers. Sorry :( It depends on what you're looking for. Some advisors will get paid by selling insurance products, some advisors get paid a one-time fee for a meeting or consultation, and some advisors get paid an ongoing fee to invest and monitor your portfolio.
There's no wrong or right way to get paid as a financial advisor (in my opinion).
At my firm, we decided the best way to get paid for us and our specific client base was to form long-term relationships with clients and charge a % of the assets that we manage and then charge an annual amount for tax filing. The larger the account we're managing, the typically more complex the situation is and the greater the risk of getting something wrong. It's not perfect, but it ensures our incentives are aligned. I tried charging hourly and didn't like it because I found that my clients were afraid of asking me questions. With an ongoing fee with unlimited support, our clients reach out all the time and are able to get advice on everything from "Am I spending too much money?" to "Should I take this job offer, and can I negotiate for more equity?"
I'll add that when you're looking for a financial planner, it's important to understand how they are paid. Like AJ mentioned, many sell insurance or other financial products, and they get a big commission, sort of like affiliate links in shopping newsletters, LOL. That's not necessarily a bad thing, but you should be aware of how they make their money and therefore what their motivations might be.
You also want to look for someone who is a fiduciary, which means they are required to put you (the client's) best financial interest ahead of their own. There are MANY different designations out there, but CFPs (certified financial planners) are required to take an exam similar to the board exam a lawyer takes and have a certain number of essentially apprentice hours before they can attach their designation to their name. Different people in the industry have mixed feelings on whether its necessary to work w/ a CFP, but their organization does put a lot of emphasis on ethics.
Such helpful information and thanks for the resources on how to find an advisor. I did a search recently using these networks and it was quite discouraging to see so many firms that looked very white and male dominated per their website. I am a female POC and it feels like such a disconnect. Secondly there were firms that noted that they were only currently accepting clients with 1 million in investable assets and based on referrals. Referrals are a known thing, but what if you’re the one trail blazing here and the first in your family to try and establish generational wealth. It all feels overwhelming with these barriers so I would be very interested to hear from those who have been successful with more inclusive firms. My search continues!
I get it for sure, the numbers in the industry are overwhelming male and white. But that’s not to say there are not amazing female and POC-owned out there. I’m friends with a lot of them. Perhaps, give the XYPN network another shot?
Check out hellonectarine.com - I love their concept. It’s a platform to look up financial advisors who charge a flat fee (as opposed to taking 1% or more of investments, which is common). Their roster has a fair amount of women and POC and they have several options depending on what your needs are. It’s a disrupter in the financial planning space and I think it’s neat! Gives a low cost way of seeing if you jive with someone too or just get a few questions answered.
I’m not connected or anything but Nectarine was started by @personafinanceclub on instagram , who I think has a great platform for financial basics and beyond
TYSM, Mk! I will check out Nectarine. I used to follow personalfinanceclub when I was on IG (now off it)
This post made me LOL, because as an insurance agent my clients also do all of these things and they also drive me crazy!
These are important things people don't think about when finding and working with a financial advisor! I would add that sometimes when a client isn't ready to work with a planner, it might be helpful to work with a financial counselor (https://findanafc.org/). I am currently working on my AFC and CFP certifications, but I have met many great professionals focusing solely on financial counseling.
How do you find the right advisor? I’m not sure how to begin.
It's such a tough process. I'd recommend starting with a few trusted professional organizations. You might try NAPFA (all fiduciaries) or the XYPN Network. You can search for local advisors or someone who specializes in your needs.
Such a helpful post!
Oh, I like this new "feature!" Good advice, thanks! I have a financial advisor and was checking everything off as I went through.
Thanks, Heidi! So glad it was helpful!
Loved this! How does a financial advisor get paid? What is the model
Financial advisors come in so many different flavors, and the industry doesn't make it easy for consumers. Sorry :( It depends on what you're looking for. Some advisors will get paid by selling insurance products, some advisors get paid a one-time fee for a meeting or consultation, and some advisors get paid an ongoing fee to invest and monitor your portfolio.
There's no wrong or right way to get paid as a financial advisor (in my opinion).
At my firm, we decided the best way to get paid for us and our specific client base was to form long-term relationships with clients and charge a % of the assets that we manage and then charge an annual amount for tax filing. The larger the account we're managing, the typically more complex the situation is and the greater the risk of getting something wrong. It's not perfect, but it ensures our incentives are aligned. I tried charging hourly and didn't like it because I found that my clients were afraid of asking me questions. With an ongoing fee with unlimited support, our clients reach out all the time and are able to get advice on everything from "Am I spending too much money?" to "Should I take this job offer, and can I negotiate for more equity?"
Thanks for this thoughtful answer, AJ!
I'll add that when you're looking for a financial planner, it's important to understand how they are paid. Like AJ mentioned, many sell insurance or other financial products, and they get a big commission, sort of like affiliate links in shopping newsletters, LOL. That's not necessarily a bad thing, but you should be aware of how they make their money and therefore what their motivations might be.
You also want to look for someone who is a fiduciary, which means they are required to put you (the client's) best financial interest ahead of their own. There are MANY different designations out there, but CFPs (certified financial planners) are required to take an exam similar to the board exam a lawyer takes and have a certain number of essentially apprentice hours before they can attach their designation to their name. Different people in the industry have mixed feelings on whether its necessary to work w/ a CFP, but their organization does put a lot of emphasis on ethics.
I hope that helps a little!
Great question.
Is it better to find a financial advisor in your state? Also can financial advisors help when a client is going through divorce?