A recent study from the US suggests that only 8% of people interviewed trust financial institutions. And, more worryingly, only 25% trust their own personal financial planners! (Source: Joe Duran, Investment news). I suspect a similar result may be found in Ireland if the same survey was carried out.
On the one hand, we could simply take from this that people’s stereotypical view of someone working in finance is the “dodgy insurance sales man” flogging products. But, it goes much further. Only 25% trust their own financial advisers – and yet they continue to work with them! Does it not show us that 75% of the population do not take their own finances serious enough?
Would you hire an electrician to re-wire your house if you didn’t trust their credential, or motives?
I would hope the answer is “No”. So why let someone you don’t trust manage your total personal wealth, which forms the basis for setting and achieving your life goals.
Yes, I have met the clients who have been clearly given completely incorrect or inappropriate advice. Only recently, we met Mary, an 81 year old lady – a vulnerable client – who had her fund of €200,000 re-invested by a bank in a 5 year Cash Bond. The earning potential was less than 0.5% per annum in cash, but the bond had an annual charge of 1%. Mary would clearly have been better off in a straight forward bank account. Was the adviser’s judgement clouded by the opportunity to earn commission, or did they simply not take the time to consider what was truly in the best interest of the client? In either case, they had lost Mary’s trust.
But, I have also met the professionals. Through many seminars and study groups, I have met like-minded financial advisers who are professional, experienced and who truly have the interests of their clients at the core of their business. They work tirelessly to explore the best options for the clients, and take the time to really get to know what is important to them. There is a growing number of Certified Financial Planners (CFP®) in the country who have spent up to two years acquiring the professional financial qualification, on top of many years experience, to bring the financial advisory sector to a different level. These trust-worth Financial Planners are the people to hire to look after your finances.
Ask the Questions
As a country, we are awkward talking about money, and challenging the cost of services. But as a financial planner, I would encourage you to ask your financial adviser,
- What is their background
- How many years of experience do they have
- What investment/insurance companies do they deal with
- Do they have access to a Tax Consultant
- Is the service fee or commission-based
- What commission are they receiving for business written, and how does this affect any policy, as regards access or charges
- How often can you expect to hear from them?
Would you not trust an adviser if they answered these questions satisfactorily? Shouldn’t you expect a call from them, every 6 months at least, to see how you are doing? Yes, you should. It is not hard to establish trust.
The Waypoint Way
At Waypoint Financial Planning, we recognise that we will not be everyone’s cup of tea. Therefore we meet you for one – a cup of tea- at our expense. This gives us a chance to get to know what is important to you, and for you to get to know and trust us. After this initial meeting, we will be able to give you guidance as to where you need to go from here – with or without our help.
We have the combined experience of a Tax Consultant, a Financial Planner and an Accountant, all with over twenty years experience in their relevant fields,
Before you decide to engage our services, we will discuss our fees with you. The fee will depend on the complexity of what you want out of the financial planning process. From the first meeting, we will have got a handle on what is important to you, identified short, medium and long term goals, and established a timeline for each. The second meeting will centre around the results of a detailed questionnaire we will ask you to complete, which will help us produce a detailed cashflow analysis, year by year, building in each goal and time line as it arises.
Most importantly, we are into building a long-lasting trusting relationship with our clients. We would not expect you to engage our services, for example, to map out your life goals, plan for your retirement or build a suitable investment portfolio, without first earning your trust.
I have no doubt the 8% will grow to 88% once we all start asking the questions, and seek out suitable, professional, client-focused financial planners.
Check out our website www.waypoint.ie or ring us on 01-5413702