Second Opinion

You Might Need a Second Opinion if…

… you break into hives at the thought of opening that monthly account statement.

… your Previous Portfolio Designs are a candidate for an EXTREME makeover.

… they were called “carphones” when you last looked at your 401k.

… you are wondering why you haven’t gotten any recent advice from the Beardstown Ladies.

… you consider the Working Years in Months (or even weeks).

You might need a Second Opinion…

The complexities and the volatility that seems to be the new normal have caused many to reconsider their original plans.  The common reasons for a second opinion fall in these broad categories:

• The new volatility has caused some investors to question previous strategies
• Recent headlines have caused investors to question their long standing relationship with Wall Street firms
• Personal circumstances have changed and there is a desire for affirmation investors are on the right track
• “I think so”, is not a good enough answer

“According to the latest research from Cerulli Associates Inc., 57% of U.S. households with at least $10 million in investible assets are now working with five or more financial advisers. Nearly 64% are working with at least four advisers.

“That’s a huge jump. In 2008, barely 16% of wealthy households had four or more advisers, according to Cerulli.

“As an indication of how things have changed, only 18% of the wealthier households are working with just one adviser.

“ ‘During the financial crisis, we found that high-net worth investors started to increase the number of financial advisers they were working with, even though there will often be one alpha adviser among the relationships,’ said Robert Testa, A Cerulli senior analyst.

“And a beta or two, it seems. One of the factors leading wealthier households to diversity their advisory relationships is a ‘solvency issue,’ according to Cerulii senior analyst Katharine Wolf.”

--  Investment News article by Jeff Benjamin, March 24, 2011 2:11 pm ET)

Recent studies show the importance of relationship development between clients and financial advisors.

A 2010 study by Pricewaterhouse Coopers reflected that just 9% of clients surveyed were very satisfied with their financial advisor.  A separate 2010 study by Cerulli research showed 70% of clients that trust financial institutions have an assigned advisor.

If you are part of the 91% that is not very satisfied or feeling like you deserve to choose the person managing your life savings, we can help.

For whatever reason that is uniquely yours, you sense it is time for you to get a second opinion.  You may have some well-deserved preconceptions. In the competitive field of finance you can expect there are often different approaches and critical responses are more likely than not. You may have a good personal relationship with your advisor and you may feel like it is, at a small level, a personal betrayal to question their judgment. You may also be concerned of the relationship damage it would cause with your current advisor if they learn you have sought a second opinion.

It is your financial future, your life savings and a Second Opinion need not cause irreparable harm or heartache. Approach your decision with clear expectations and remain open.  We recommend you establish these measures of success:

You are open to the conclusion that what you are doing now is exactly what you should be doing for your future.  One positive outcome could be affirmation.  This is a hurdle of savings and/or improvement you must meet before you act on any second opinion

You communicate with any suitor firms your expectations:  you are looking for clarity, sensitivity, discreet and confidential review with the understanding that you may not make an immediate change and the firm should have no expectations.

You are in charge of your decision, if you feel it is appropriate you may want to inform your existing advisor of your course of action.  The decision, the steps and the timing are in your control.

You may find it is appropriate to pay a fee for the analysis; many firms waive that fee for the opportunity to show you what they can do for you.  If your financial assets warrant, you may use multiple advisors, in which case you should consider a designated “alpha advisor” that coordinates your plan and provides monitoring and due diligence of the work performed by the other advisors.

There is no need to start a fire just have something to do, either.  If your current advisor(s) are providing quality service, results and consistently act with your best interests, you may be in the best hands right where you are now.

The disciplines of financial planning, risk management and investment management are often included in a financial advisory relationship. Keep that in mind when you compare pricing.