Has your financial advisor created a contingency plan for you? – St George News


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FEATURE – If your advisor died or became incapacitated, do you know who would step in to manage your account?

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Almost everyone who has started the task of shaping their ideal retirement probably has this question in mind. This is a necessary, albeit uncomfortable, conversation you need to have with your advisor. When you realize that 73% of all advisors and agents don’t have a succession plan in place, it’s a discussion to have with the person in charge of your future. financial.

America’s aging is also happening to advisors.

The average financial services professional is 51, around the age many Americans start planning for retirement. Nearly forty percent of current advisors say they want to retire within the next decade. Even if your advisor wants to work as long as possible, poor health or chronic illness could force them to retire earlier than expected, perhaps just when you need them most.

Does your advisor have a plan B in place?

You share a lot of personal information with your financial planner, so you need to know that your money and sensitive data is protected no matter what. This protection extends to the unforeseen death or illness of your advisor. Since your advisor’s job is focused on protecting your wealth, it makes sense that they have a contingency plan in place and that you know the details of that plan.

Things to consider

If your money is with a larger financial services company, what if your current advisor dies or is physically unable to service your account? There is a good chance that you will be entrusted to one of the other advisers of the firm. If so, you want to know if you will have a say in who ends up with your account.

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Will you have the opportunity to interview other potential advisors at the firm to see which one is the best fit for you? Will you be able to take your account elsewhere if you don’t like your options?

Having a team would help

One way to deal with the possibility that your current advisor won’t be around when you retire is to build a team of advisors rather than relying on just one person. Taking a team approach to planning might be a good idea, even if you don’t worry about suddenly having to switch advisors later. After all, what gets you to a certain point in your financial life isn’t always the same thing that will help you achieve your retirement goals.

A team strategy allows you to benefit from having multiple pairs of eyes looking at your portfolio and providing insight.

What about robo-advisors?

There have been discussions in the financial services industry about artificial intelligence making things happen in the form of robo-advisors. Indeed, robo-advisory firms have dramatically reduced asset management costs and created new efficiencies in money management.

If you’re currently paying someone to oversee your accounts, using a Robo Advisor might offer a cheaper alternative. However, if you are not comfortable with technology, you might want to think twice before going down the untested artificial intelligence route.

Letting an algorithm make critical financial decisions may not seem fair, leading to increased stress in retirement. You may also not like to do a lot of the heavy lifting yourself when it comes to planning. The AI-based financial advisory model isn’t quite there yet, so you’d probably be responsible for most of the things your human advisor does now. Is this something you want to do?

In summary

Financial advisors are not superhuman. They are subject to the same life challenges as the rest of us: the possibility of premature death, disability and chronic illness. Advisors who are not at least ten years younger than their clients will likely retire at the same time.

Chances are the advisor you started your financial journey with isn’t there to help you finish it. Please plan accordingly and don’t be afraid to ask your trusted advisor about their plan B.

Copyright © Lyle Boss, all rights reserved.

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