// Financial Advice Isn’t Just for the Wealthy //
By: Taylor Haney

Have you seen that commercial with people walking around with large numbers floating over their heads? You know, the “retirement number” commercial? I know many of you see these numbers and read about the millions of dollars you need for retirement, but the reality is: it’s not reality for most people. In fact, you may think that if you aren’t making $250,000 a year and don’t have at least $1,000,000 of investable assets that you don’t qualify or need financial advice. This is exactly the message larger firms and national wire houses want you to get – if you’re not wealthy, we can’t help you.

A friend of mine – who worked for a large wire house – recently lost a large portion of his clients to his firm’s call center. The firm informed him that every client with less that $250,000 was not worth his time. The firm removed the clients from his book and shipped them off – wow! This really shouldn’t surprise you. The big firms have been moving upscale for a long time. I’m not saying this is a bad business model. I’m just saying it leaves a lot of individuals and families without access to financial advice. Most of these people really need help.

You’ve also probably read or heard about the recent changes in the wealth management industry as it pertains to the advice given on retirement accounts – the fiduciary rule. Many distractors of this rule have expressed that it would force many advisors to shy away from helping clients with less assets. While I don’t disagree, this viewpoint is too limited. This is based entirely on a practice that receives its only form of compensation from investment management fees or commissions. While this blog is not intended to discuss the merits of the fiduciary rule, I think it’s important to note that these changes do affect how some individuals and families will receive advice.

First, you must define what financial advice is. For the sake of brevity, it is most commonly known to be financial planning and investment advice. Clearly this does not cover the gambit, but that’s the basics. As a matter of principle, I try not to separate these things. Our industry has coined many phrases like “life planning”, “retirement planning”, “college planning”, etc.…. While I don’t disagree with these topics, I think it can all be summarized under personal financial planning. The advisors who earn commissions on the sale of securities have coined these phrases to create opportunities. Rather than focus on an all-encompassing plan, it’s easier to have customers focus on one opportunity and provide a financial solution. I don’t consider this financial advice, and regulators would agree; hence the new regulations.

Second, you must understand how different advisors work. I don’t necessarily mean how they are compensated – as that topic has been beaten like a dead horse – but, how their business works. Does the advisor work as a financial planner? Are they primarily an investment manager? Are they a marketing arm of a large corporation? Are they an insurance agent? Are they looking to grow? If you are looking for financial advice, then you must seek out a practice whose primary focus is financial planning – it’s really that simple. Ok, it’s not that simple. Why? Everyone claims to be a financial planner. I’m not going to elaborate on this too much, as there will be many advisors who resent me for saying it, but the truth is, there are few qualified advisors who actually know how to do plans. These advisors also have different ways of billing for their services.

Third, define what it means to be wealthy to you. While we do serve many individuals and families who fall under the traditional definition of wealthy, I think it’s important to note that they weren’t always that way. I recently told a friend that true wealth is the ability to pay for and fix something when it breaks. I was only half-joking. In all seriousness, if you have discretionary funds, are saving money, and have goals, you’re well on your way. If you’re not sure what wealthy looks like to you, ask an advisor. Their answer may or may not align with your thoughts. If they do, a conversation is warranted.

I’m going to do something I don’t normally do, and that’s pitch the services of myself and the firm. Our firm has worked really hard to provide a landing space for advisors who service all types of clients and to be a hub for individuals and families of all walks of life looking for financial help.

To the point: you do not have to be wealthy to get financial advice.

Our services aren’t free (well, it depends!) and we aren’t a fit for everyone, but at our core is the desire to help those who want to be helped. There are no rules on how much money one should have, only that they need help and are willing to commit to financial guidance. There are other quality firms in the area who have also committed themselves to serving those who want and need help. Don’t wait until you are wealthy or retired to find a qualified advisor, because chances are, you will miss out on solid advice that could have helped you along the way.

If you are considering hiring an advisor, but don’t fee like you can afford one, or don’t feel like you are wealthy enough, please give us a call. After all, we are a Community Family Office.