Are Financial Planners and Advisors in Kansas City missing the point?

by brendon on April 26, 2011

 

Why use an Independent, Fee-based or Fee-only Financial Planner?

To implement or rely upon complicated investment strategies that use a prediction or forecast?   Or is it pay for an expensive multi-chapter financial plan that eventually gets  itself  “parked” on the shelf and never opened again?  Perhaps it’s for “bragging rights” around the water cooler or the next dinner club party?

How do you think Financial Planners and Investment Advisers answer this? An acquaintance of mine Richard Reyes in Florida just published an insightful article at Wall Street Journal Financial Adviser challenging the industry on this very issue.

Read Richard’s Wall Street Journal post by CLICKING HERE. Then, tell me what you think the point is by POSTING A COMMENT BELOW.

If you do, I’ll send you a FREE COPY of the #1 New York Times best selling book THE INVESTMENT ANSWER. You’ll be able to read this 66 page book in one-sitting.

{ 8 comments… read them below or add one }

Chris Locke May 10, 2011 at 7:14 am

Simple point – no one can predict the future and “time” the market. I agree with you, a diversified investment portfolio that captures market rates of returns is what we as investors should strive for.

Thanks for all your great articles. Keep up the good work.

Chris

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Dennis D. Duffy January 7, 2012 at 11:10 am

Brendon, Great article and video! Thank you. What a nice offer to send the book. I hope many folks in Kansa City take advantage of this great book and also your independent coaching. I know for me personally and professionally, the traditional financial planning never worked and I was always frustrated, anxious and confused about my money. Once I learned the difference in the two philosophies about investing and was able to ensure my own portfolio was constructed to not violate the basic rules I was on my way to peace of mind. Good luck in helping many others achieve this same confidence with there money and their lives!

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Robert Svoboda December 21, 2012 at 9:50 am

The advisor should always keep their clients best interest in mind and handle their money with prudence and as if it their own money. We see to often where the advisor pushes items that make them the highest commission.

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brendon December 21, 2012 at 9:54 am

I learned a long time ago that broker dealers and insurance companies create sales quotas, provide incentive trips and develop software programs to sell more product. Are you familiar with “soft dollars”?

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Juro Trubiroha September 1, 2013 at 3:50 pm

I never knew the difference between diversifying or single picking. I definitely see more sense in the first strategy. So how do you choose a solid fee based FA in KC area? I checked on my financial advisor web and they are all out of state. I would prefer somebody I can meet with.

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brendon September 3, 2013 at 12:06 pm

Juro-the first thing any investor should decide is what kind of investment philosophy do you want to embrace. You have the choice between ACTIVE MANAGEMENT, which relies upon stock picking, market timing and track record investing. Alternatively, PASSIVE MANAGEMENT relies upon strategies that focus on capturing market rates of return in broadly diversified portfolios with lower risk and cost. My firm embraces these philosophies. Much like a religious philosophy, investors of all types need to have something to hold onto that they consider TRUTH. There are TOMES of academic evidence and history proving active-management strategies are costly and generally speaking will lead investors to lower returns.

Call or email directly if you’d like to discuss further.

Sincerely, Brendon Jenks, Investor Coach
http://www.wealthrenovators.com

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Mark April 20, 2014 at 12:13 pm

Never been sucked in by the sales pitch – have a good friend in the broker-sold business – we always have a healthy discussion on the pros/cons of using a planner. My belief is making decisions without sales pressure leads to better long-term results. And planning should be more than investment counsel – it needs tax/estate/retirement issues as well.

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brendon April 21, 2014 at 9:10 am

Mark-you’re right that planning should be more than just investment counsel. A collaborative approach between financial adviser, tax and estate professionals is critically important. Retirement income planning also requires objective counsel since the industry is flooded with commission-driven sales people posing as advisers. Too many investors are not being educated about simple strategies to be successful at this. Unfortunately, even some well-meaning folks that work for the large insurers fall into this same category.

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