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A Dignitas Briefing Paper
FIVE KEY QUESTIONS TO
ASSESS YOUR FINANCIAL ADVISOR
A BENCHMARKING TOOL FOR DETERMINING WHEN TO UPGRADE YOUR ADVISOR
If you have never taken the time to review your financial advisor or are not sure how. While some advisors helped their clients successfully manage the downturn.Assessing your financial advisor ensures your financial plan stays on track. PERSONAL BENCHMARKING: Benchmarking allows families to understand where their current position is in relation to a particular goal. The recent financial crisis taught everyone that not all financial advisors are created equal. others consistently underperformed in terms of investment advice and service. as the firm does not participate in any third party commissions or fees. BALANCE SHEET ADVISORY: Dignitas serves as a fiduciary to your family and provides tested and untarnished financial advice. Dignitas has created this convenient scorecard for assessing your advisor’s performance. Dignitas Service Offering WEALTH COACHING: Dignitas wealth coaching provides executives and entrepreneurs a unique platform to concentrate on developing the habits and maximizing the skills to help you meet your financial goals. Request a Consultation Video Overview Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 2 .
high quality and independent advice and solutions that allow them to simplify their lives. seasoned executives and individuals entering their second life. Nick has become a go-to advisor for start-up/high growth entrepreneurs. With 15+ years of experience in the financial services and wealth advisory industry. Follow Nick on Twitter @DignitasCWO Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 3 .About the Author: Nicholas Delgado Assessing Your Financial Advisor By Nicholas Delgado Nicholas Delgado founded Dignitas to provide clients with personalized.
(3 points) Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 4 . Reviewing your annual fees is an important exercise in determining how well your financial advisor is performing in terms of their service offering relative to their fee structure.1. I have no clue how much I pay my advisor. (1 point) 2) Maybe. I think I know but I am not sure. Fees: do you know how much you are paying your advisor? Many people sign their client agreement and then forget how much they are charged on an annual basis. Do you know how much you are paying your advisor in fees? 1) Yes. (2 points) 3) No. my advisor’s fee structure is very clear and transparent.
(1 point) 2) I’ve seen performance reports but I am not sure what they mean. Performance: is your advisor regularly discussing your portfolio’s performance? Every investment portfolio is different and performance can be very difficult for the average investor to evaluate. Nonetheless. I have no idea how my investment portfolio is performing. it should be a topic that your advisor discusses with you at least once a year and they should provide you with regular performance reports throughout the year.2. (2 points) 3) No. my advisor keeps me up to date on my portfolio’s performance. (3 points) Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 5 . Do you know how your investment portfolio has performed over the past 12 months? 1) Yes.
(3 points) Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 6 . Relationship: how often do you speak with your advisor? Many people select their financial advisor after several introductory meetings and conducting a thorough review of the individual and their firm.3. but not as often as I would like. (2 points) 3) My advisor barely knows my name and I only hear from him when he wants to sell me a new product. How frequently do you hear from your advisor? 1) My advisor meets with me at least once a quarter and I receive regular informational materials and reports throughout the year. some seldom hear from their advisors on a regular basis and receive erratic communication from their advisor’s firm. (1 point) 2) I hear from my advisor occasionally. But once they become a client.
In addition. It’s also important to discuss key financial planning topics such as estate planning. tax planning or risk management. cash flow budgeting and financial education. it should not be the only service they provide. some advisors also provide value-add services such as life management. Does your advisor assist you with various financial and life planning issues throughout the year? 1) Yes. my advisor helps me make major financial decisions by providing me consultative advice and educational resources. (1 point) 2) My advisor has offered these services in the past but I have never followed-up on their offer. (3 points) Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 7 . my advisor only provides me with investment advice as it relates to my investment portfolio.4. Value-add: does your advisor provide more than just investment advice? While managing your investment portfolio is a significant aspect of the services that your advisor provides you. (2 points) 3) No.
Whether it’s the commissions hidden in the fine print of the products your advisor might be selling or other incentives they may receive for recommending a product.5. (2 points) 3) My advisor works at a broker-dealer and can recommend products that pay him a commission that I may be unaware of. (3 points) Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 8 . (1 point) 2) When my advisor recommends a product he actively discloses if a third party is compensating him. understanding your advisors potential conflicts of interest is important. Independence: is your advisor offering you conflict free advice? During the 2008-09 financial crisis investors learned the hard way that many financial service companies put their best interests before their clients. Does your advisor actively discuss or disclose potential conflicts of interest they may have when recommending a product? 1) My advisor is a fee-only advisor and does not receive any commissions or incentives from the products that he recommends.
Scorecard: How did you score your financial advisor? After answering all of the questions. If your advisor scored between 12-15 points: It’s time for you to consider replacing your advisor. Dignitas provides individuals with a complimentary consultation on their financial plan. Start first by interviewing new advisors and discussing with them your personal and financial goals as well as items such as fees. communication expectations. and their investment and planning services. review the scorecard below to help determine the strength and quality of your current relationship with your financial advisor. If your advisor scored between 5-8 points: Congratulations. Dignitas provides individuals with a free Second Opinion Assessment on their investment portfolios. you likely have a strong and rewarding relationship with your financial advisor. If your advisor scored between 9-11 points: Consider getting a second opinion from a different advisor or having a conversation with your current advisor on items such as fees and your communication expectations. SCORECARD Answers /Questions 1 Point 2 Points 3 Points 1 2 3 4 5 Total Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 9 .
CIMA®. Wacker Drive Suite 2606 Chicago. CFP® Principal | Chief Wealth Officer nick@mydignitas. IL 60601 www.651. Our full-service life management platform orchestrates a collection of business and personal services to support our clients’ whole life needs. To continue the conversation. please contact: Nicholas Delgado.com Dignitas is an Investment Advisor Registered with the State of Illinois.mydignitas. Dignitas is a multi-family office and wealth management firm. Share Dignitas’ Briefing Paper Assess Your Financial Advisor By Nicholas Delgado 10 . We provide clients with independent and objective advice and solutions beyond the traditional investment management and financial planning model.6130 Dignitas 111 E.Dignitas: An Independent Investment Advisor Committed to Keeping Your Life Optimized. CRPC.com Twitter: @dignitascwo 312.
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