The True Value of a Good Advisor

Divorce can be a stressful and uncertain process. During such times of uncertainty, having a reliable, trusted adviser who can offer impartial advice throughout the divorce process can be crucial. No doubt that’s why you’re reading the Equal Exes blog.

As an investment adviser, I’d like to think I’m another such trusted adviser.  

The role of an investment adviser, and more importantly the value we add for our clients can often be misconstrued. Some people see advisers as the pin stripe suited, cigar smoking type. Others think we play golf all day. And sometimes people confuse us with insurance brokers or mortgage advisers.

To be clear, I rarely wear a suit and I don’t smoke. Further, my 22 handicap is proof I don’t play much golf at all. This begs the question then, what do I do? Primarily, our job is helping clients gain clarity in their investment objectives. This is particularly relevant in today’s world where there is a massive information overload and share trading has been democratised by the rise of online trading portals and apps.

A number of people who are introduced to investment advisers do so as a consequence of some sort of life changing event (divorce, sale of business, downsizing the family home, etc.) These changes can be unsettling, and therefore the need for quality, impartial advice becomes imperative.

Understanding a client’s investment goals and objectives is a key facet to being a good investment adviser. A common investment goal is retirement and ensuring that certain living standards are able to be maintained. Perhaps a client is a charitable trust or a not-for-profit with a more altruistic investment purpose? Maybe inter-generational wealth is a key consideration and so detailed conversations are required to determine the best investment outcomes. Either way, it is crucial to ensure that clients understand what it is they are hoping to achieve with their investments.

Even more importantly, once investment objectives have been agreed, my job is ensuring that clients remember and stick to them. A good adviser is the gatekeeper – or maybe more accurately, the bouncer – to any bad ideas that might try and get in the door. Trust me, there’ll be a few of those. Most investment objectives are long-term goals and along the way there will be plenty of events, risks and other temptations to navigate. Just look at markets over the last three years!

We’re human after all, so it’s no surprise to see people being tempted to stray from their investment objectives due to the myriad of market commentaries. This focus on investment goals and objectives can be characterised as the behavioural coaching part of the job – helping you avoid any behavioural bias.

A good analogy of why to engage with an investment adviser might be to consider why people engage with an architect. Sure, anyone can watch a few episodes of Grand Designs, buy a plot of land and draw a house. But a good architect will understand their client’s needs and optimise a house for the site it sits on. They’ll draw detailed plans, navigate the council consent process and finally they’ll oversee the construction process. Along the way, a good architect should help the client save time and stress and ensure an optimal outcome.

Similarly, a good financial adviser can help clarify objectives, design a portfolio to assist you in reaching those objectives and then work with you to manage that portfolio over the long-term to ensure it remains appropriate for those objectives.

If you’re in the unfortunate position of going through the end of a relationship, and you would like to discuss how you can best harness your financial independence, please don’t hesitate to get in touch, either with myself or my business partner Tanya Osborne.