When you’re facing a serious medical situation, it’s normal to seek out a second opinion. Assuming you have the time, energy and opportunity, why wouldn’t you? Your life’s on the line, after all.
“Getting a qualified financial advisor to take a second-look at your investments is something everyone should do on a semi-regular basis, every five years or so. You’ve worked hard to build your nest egg — it makes sense to gather as much information as possible on taking care of it.”
Getting a second-opinion isn’t just something to do when you’re unhappy — even talented advisors sometimes overlook important opportunities, and unless you’re a trained financial expert you’re not likely to notice.
“It’s not about changing advisors or switching your loyalty — if you’re in good shape, a second opinion won’t lead to any drastic changes. But it gives you extra knowledge, an extra set of eyes that will give your portfolio the best chance at success,” Clark says.
What to expect from your second opinion
1. The face-to-face
- What level of risk can you tolerate?
- What are your long term goals?
- What is your budget, and how much are you saving month-to-month?
- Are you expecting to make any big changes to your lifestyle?
“You may have discussed these things when you first started investing, but it’s important to keep that information up-to-date,” Clark says. “It even happens in great advisor-client relationships. You may think you know the other person well enough that you don’t have to ask, but that’s how little things can get missed.”
You’ll likely keep your financial advisor up-to-date on big changes like marriage, divorce, or the birth of a child, but gradual changes matter too.
2. The plan
Once the advisor outlines your current goals, they’ll take a look at your financial plan.
“It may be very straightforward, but we’ll check to see if anything’s missing,” Clark says. “Someone giving a second-opinion may have suggestions to fit your current lifestyle.”
3. The investments
Now it’s time to study your investment statements and other paperwork. Are you invested beyond your risk tolerance, just for your advisor’s benefit? Are you being charged unnecessarily high fees?
“Some companies are still charging high fees, but there’s no way the average investor would know they’ve been overcharged, unless they get a second opinion,” Clark says.
Envision Financial is a division of First West Credit Union.