In the midst of our current huge financial crisis, a prominent national publication released its annual list of the top financial advisors in America. I suppose maybe this is a good time for people to know who to turn to for their financial advice, so I read through the article. In the very small print at the end (you know, the stuff no one reads – but I always read) I found the criteria for being selected to the list. The researchers considered things like total dollars under management. That’s good to know since you wouldn’t want an advisor who only had a couple of clients. They also looked for total revenue. Hmm. I had to think about this for a while. I have no problem with people making money but is that a good criteria for determining how good their advice is? There were other items such as investment selections and book keeping procedures. But then I came upon a line that stood out boldly, even though written in very small print. I will quote it here exactly: “Portfolio performance was not a criteria for selection to this list.” You have got to be kidding me! A person can be listed as a top financial advisor without any consideration of whether their advice was any good or not?
I thought of other career fields and wondered how long they would stay in business if they were evaluated using the same criteria. Imagine ranking an auto mechanic without considering whether the cars he worked on ran properly. What about rating a doctor without considering the outcome of her treatments? Would anyone use a lawyer who lost most of his cases? I chuckled at the thought of ranking the top college football coaches in America with a notation, “A coach’s win-loss record was not a criteria for selection to this list.”
Let’s get back to reality here folks. Critical to the evaluation of a good financial advisor is measuring the results of their advice. Portfolio performance at some level is essential. Now that is not to say it needs to beat some arbitrary index, or generate a specific return for a client in excess of what their neighbor may be earning. Finances are a very personal matter with each coming to the table with different needs and varying resources with which to address them. The best financial advisors in America are those who help each client on their own individual level, and within a framework of risk they are comfortable with, to reach their unique goals.
Because of the individualized nature of financial planning, I feel there is no way to truly award “The Top Financial Advisors in America” because each client uses a different criteria for measuring success. An advisor who might be top for one person would be a lot of sleepless nights for another. So find someone who shares you ideals, is well educated, certainly a CFP®, and with whom you have a good relationship.
Hi, I'm Dan. I'm a CFP® Professional.
Securities and advisory services offered through Commonwealth Financial Network®.
Member www.finra.org / www.sipc.org , a Registered Investment Advisor. Wyson Financial, 375 E Riverside Dr, St. George, UT 84790
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