Page 3 - 4270 Fall 15

Who looks out for your interests? While in some cases it may be a caregiver, in all other instances, it’s you. You are your own protector and guardian. It’s on you to make sure you are dealt with openly and fairly, and not taken advantage of. How do you do that? By being informed and aware. It means asking questions. This is especially true when dealing with professional services providers whose area of expertise is unfamiliar to you, or complex in nature. Investment professionals (brokers and advisors) are a good example. Let’s look at three situations with investment professionals where a few good questions will help you protect your interests, or confirm that the investment professional is looking out for yours.
If you are being solicited by an investment professional, how do you
want the interaction to go? Do you want to feel overwhelmed or pressured into buying products you may not need, or do you want to use caution, protect your interests, and know exactly what you’re getting into? Interrupting the sales pitch with a few questions is a good way to look out for your interests. Here are two:
1) “What is your basis for believing
that this investment is suitable
for me?”
2) “What are the costs associated
with buying, holding and selling the investment?”
If you are considering working with an investment professional, it may be one of the most important business relationships you’ll ever enter into. You need to get this right. Do you know what questions to ask yourself and what questions to ask the investment professional? Here are two:
the expert
3
ASK
The Good, the Bad and the Ugly of
Working with Investment Professionals
By Mark B. Robinson, Investor Advocate and Co-Founder, LifeGuide 360
1) “Will you put me first in our professional relationship, and not advance your interests or those of your company at my expense?”
2) “In what ways will you receive compensation for handling my account?”
If you are already working with an investment professional, what do you really know about the relationship? Is
it based upon openness, fair play and accountability? Do your interests come first, or is it a one-sided relationship that takes advantage of your blind trust? Do you really know? When an investment professional acts solely in their own interests, it places you at risk. For most of us, these acts of self- interest are hard to spot. This can be very costly. So what questions do you ask? Here are two.
1) “Are you putting my needs and interests first in our relationship?” This is perhaps the single most important question you can ask. It tells you a lot about the quality of the relationship and the intent of your investment professional.
2) “Show me.”
Here are two examples of ways your investment professional can show you: 1) Provide an annual accounting of
all costs, fees and commissions associated with the handling of
your account. Controlling costs is a good way for your investment professional to show that you come first in the relationship.
2) Provide a performance report on your account for the last two years (minimum). This shows whether your investment professional’s decisions are adding value or subtracting value from your account. Not knowing how your account is performing could be costing you hundreds or even thousands of dollars a year from under- performance.
Note: Do not evaluate your investment professional by performance alone, especially over the short-term. While competitive returns are always impor- tant, consistently “beating the market” is nearly impossible. What’s always possible is for your investment profes- sional to demonstrate that you come first in the relationship. One way to do this is through open and ongoing com- munication, regardless of whether the news is good, bad, or even ugly.
To learn more about how to use the power of questions to look out for your financial best interests, join us for an empowering session during the Solutions for Family Caregiver Expo, October 17th.
PAID ADVERTISEMENT