As successful finance leaders, the members of Forbes Finance Council understand what information a financial advisor needs to help a client reach their goals. Here, they share 13 pieces of information you should share when meeting with your financial advisor.
Members of Forbes Finance Council detail essential information it's important to share with your financial advisor. PHOTOS COURTESY OF THE INDIVIDUAL MEMBERS.
1. Risk Tolerance
Understanding one’s risk tolerance can be the greatest factor in becoming a successful investor. You’re better off if you ask yourself, “How far am I willing to see my account go down rather than up to reach my long-term goals?” Down markets are nothing new and are always part of an overall return. Put together a financial plan and stay the course. - Lance Scott, Bay Harbor Wealth Management
2. Specific Goals
All investing begins with clear, written goals. If you can’t define your goals in writing and commit to them, then your advisor can’t possibly design a sensible portfolio for achieving those goals. Further, “making more money” is not a goal. Real goals require a focus on the future, a burning “Why?” in pursuit of the goal and a willingness to defer gratification into the future. - Erik Christman, Oxford Financial Partners
3. Your Definition Of Success
Meeting a financial goal like retirement is just one way to look at the success of the relationship between a financial advisor and a client. Share your holistic definition of success, including the things that will give you peace of mind, like risk avoidance and frequency of communication. If you want your advisor to exceed your expectations, they need to know you. - Robert Roley, SS&C
4. Your Annual Spending
Every piece of advice revolves around the answer to the question, “How much do you need to spend in a year?” It determines how long you have to work and how much you have to save, and it dictates your investment strategy. Most incoming clients do not know this number. We help them get there. - Sharon Bloodworth, White Oaks Wealth Advisors
5. Your Primary Financial Concerns
Be prepared to know what keeps you up at night. A good advisor can solve for a broad range of problems—however, articulating your main concerns will allow the advisor to focus on what’s important for you first. - Cole Stoneman, IronBridge Wealth Counsel
6. Income And Expense Flows
Understanding all income and expense flows is key to helping the advisor understand what a client wants retirement to look like. Frequently, people want a “retirement optional” scenario where there are other sources of income—such as consulting or rental property—to supplement their lifestyle. Knowing income and expense flows is critical for the advisor to properly construct the retirement financial strategy. - Meredith Moore, Artisan Financial Strategies LLC
7. Your Personal Vision Of Wealth
Any true financial advisor is there to serve you beyond managing your investments. They should be the steward of your wealth, a trusted resource and a confidant for all things in your life. To get the most out of your relationship with your financial advisor, you need to share your aspirations, your personal vision of wealth, your spending habits and more with them. Don’t be shy, and always seek clarity. - Jonathan Turner, Clarus Merchant Services
8. Income And Capital Growth Requirements
The client needs to express their income and capital growth requirements and should, in return, have the corresponding risk level and market practices explained to them. From a regulatory point of view, it is the investment advisor’s obligation to explain risk scenarios to the client and to educate the client about the investment so the client can make an informed decision. - Azamat Sultanov, Fortu Wealth
9. Your Financial Dreams
A financial advisor is there to help you grow your wealth, and if they understand not only where you realistically want to be but also where you ultimately dream to be, your chances of getting there are higher. Don’t be afraid and hold things back, like debt or spending patterns—being transparent with your advisor is the best way to ensure they can help you reach your dream. - Jared Weitz, United Capital Source Inc.
10. Recent Financial Changes
To get the maximum value out of my financial advisor, I tell him everything. If my budget changes, I let him know. If I’m getting a bonus, it’s the same story. Financial advisors can only help you if you let them do their job. When you provide them with all of the facts, they can help guide you in the right direction to achieve your long-term goals. - Robert Reeder, GlassView
11. Where You Stand Right Now
Anticipate questions and bring clarity to your first meeting with your advisor. The first step is to make sure you are clear on where you stand now: what your net worth is, your expenses, debt, etc. Step two is to clearly communicate where you realistically want to be by the time you retire. Step three is to create an allocation plan and budget that will work in your favor and protect your assets and family. - Gabriela Berrospi, Latino Wall Street
12. Your Current And Future Lifestyle
Let them know what your current lifestyle looks like and if you will maintain that same lifestyle into retirement. Reaching your retirement date is inevitable. However, knowing what your lifestyle will look like in retirement lets your advisor know what you want to accomplish and in what areas you’re willing to sacrifice. I love to ask, “If you had unlimited resources today, what would you be doing?” - Justin Goodbread, Heritage Investors
13. All Your Financial Commitments And Goals
Communication with your financial advisor can be daunting. However, it’s important to bring a full and rounded picture of your expectations, spending, personal financial commitments and goals. Do you have family members whom you care for? Where do you see yourself in five years? It’s very important to communicate all of this upfront. - Kelly Shores, GCubed, Inc.