INSIGHTS FROM FIRST FOUNDATION

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What exactly do you do? How to select your financial advisor.

In my previous piece, I outlined the differences between investment managers and financial planners. I shared that we, at First Foundation Advisors, take the hybrid approach of investing and planning and that we call it “private wealth management.” This approach seems to work well for our clients, especially those who want a personalized investment solution that speaks to both financial returns as well as life goals.

In this article, I am sharing with you questions that you can ask to help uncover which approach, and therefore which firm, is the best fit to manage your wealth.

Questions you can ask to help identify your trusted advisor

To make it easier for you to take action on creating your wealth plan, we thought it would be valuable to provide several questions that you can ask of any financial advice-giving professional to see if they qualify for what you are looking for in a trusted advisor.

What is the firm’s primary focus?

In other words, can the firm help you with all your unique needs? No one client is the same. The Starbucks approach might work for coffee but we do not think it is appropriate for finances. People want customization and personalization. Many firms take a one size fits all (grande latte, please) approach to planning, while others will focus on only individual planning, business planning, estate planning, multi-generational planning, or philanthropic planning. Rarely do they have the ability to serve all of these categories, even though it is highly likely that throughout the course of your life you will need someone who can handle all of these needs. So then why not find someone who can grow with you as your needs evolve? Take the time to do the pre-work upfront and you will likely end up with an advisor who can help you during any stage of life.

What are the credentials and how do they apply to wealth planning?

Financial planners may have extensive experience working on plans for all sorts of circumstances. Many have experience practicing tax law, which can come in handy if you have a complicated estate or complex business needs such as succession planning or M&A. Team members should be accredited with a CFP or CFA, and have committed their careers to viewing investment management through the lens of financial planning. These credentials ensure, among other things, that they stay current with the latest tax laws as well as take the course of action that is in your best interest. But these credentials have become table stakes for any advisor. Be sure yours have them.

How is your planning team compensated?

There are essentially three ways a wealth planner is compensated. They are either 1) paid a commission for the sale of a plan or other financial instrument; 2) paid a percentage fee on assets they advise on; or 3) receive a flat fee for completing your plan. Determine up front which way you are most comfortable with.

How do they measure success?

Benchmarking returns for investment managers can be relatively straightforward. Determining how your financial plan is doing relative to your goals can be quite obscure. Ask how they measure success. And ask yourself what you would deem a successful financial plan. Some of you might have wild ambitions and are okay only hitting 80% of your targeted goals, while others might want to see every financial dream come true. No one person is the same, so before you embark on a plan, take stock of what will be your metric of success.

Who is your main point of contact?

Are you speaking with the credentialed team member, or do you have to work through other people in order to get on his or her schedule? Obviously, who you work with is important. You must feel a sense of trust. Are you speaking with a call center who relies on a technology to supply the answers you need? Be sure you are comfortable with the person you interact with. There is no right answer to this, it is a personal preference that should be addressed. Also, it is important to note that wealth planners typically take a consultative approach, so if you aren’t getting the feeling that you are being coached and mentored along the way, then move on. After all, this is your money – you (or someone close to you) worked hard for it. You should feel the sense that the person helping you is equally committed to working hard for you.

What happens next?

Always try to stay one step ahead. A good wealth planner will outline the steps in a very logical flow. Every financial planner has their five- or six-step process. This should allow you to see the next tangible goal. But also keep asking “what’s next” – as we have seen in recent markets, there is always room to improve your positioning based on your life goals. Evaluating every potential scenario (within reason) will help you prepare for the next move, whether it be in the markets or in your life.


We hope you found this to be informative. If you would like to learn more about how we approach developing your financial plan, please contact us. Or read more from our team here.

IMPORTANT DISCLOSURE INFORMATION    

Please remember that past performance may not be indicative of future results. Different types of investments involve varying degrees of risk, and there can be no assurance that the future performance of any specific investment, investment strategy, or product (including the investments and/or investment strategies recommended or undertaken by First Foundation Advisors), or any non-investment related content, made reference to directly or indirectly in this blog will be profitable, equal any corresponding indicated historical performance level(s), be suitable for your portfolio or individual situation, or prove successful. Due to various factors, including changing market conditions and/or applicable laws, the content may no longer be reflective of current opinions or positions. Moreover, you should not assume that any discussion or information contained in this blog serves as the receipt of, or as a substitute for, personalized investment advice from First Foundation Advisors. To the extent that a reader has any questions regarding the applicability of any specific issue discussed above to his/her individual situation, he/she is encouraged to consult with the professional advisor of his/her choosing. First Foundation Advisors is neither a law firm nor a certified public accounting firm and no portion of the blog content should be construed as legal or accounting advice. A copy of the First Foundation Advisors’ current written disclosure statement discussing our advisory services and fees is available for review upon request. Please Note: First Foundation Advisors does not make any representations or warranties as to the accuracy, timeliness, suitability, completeness, or relevance of any information prepared by any unaffiliated third party, whether linked to First Foundation Advisors’ web site or incorporated herein, and takes no responsibility therefore. All such information is provided solely for convenience purposes only and all users thereof should be guided accordingly.

Tyler J. Resh, Director of Marketing and Strategy
About the Author
Tyler J. Resh, Director of Marketing and Strategy
As a Director of Marketing and Strategy, Tyler Resh oversees all marketing efforts of First Foundation’s three main lines of business: private wealth management, personal banking, and business banking. Mr. Resh works on a diverse range of business development activities including public relations, communications, design, branding, digital and print advertising, events, in-bound marketing, and content marketing. Previously, Mr. Resh worked at the investment banking firm, ECHELON Partners where he oversaw the investment banking, consulting, and research engagements of the firm. In this capacity, he negotiated transactions between buyers and sellers, prepared offering documents, created detailed financial models, conducted valuation analyses, and produced industry research reports. In the course of these assignments, Mr. Resh has developed close working relationships with the most prolific investors and buyers in the financial services industry. Over the course of his career, Mr. Resh has consulted on both strategic and tactical assignments across a wide range of financial services markets, business lines, and products. His work experience has included engagements with investment managers, insurance companies, private banks, trust companies, commercial banks, broker dealers, and financial planning firms. Mr. Resh also has published and produced white papers, executive seminars, conference presentations, and institutional research reports. Prior to working at ECHELON Partners, Mr. Resh worked as a consultant for Computer Sciences Corporation (CSC), a recognized leader in business process and technical outsourcing. At CSC he advised Fortune 1000 companies in ways to redesign their business processes to reduce internal costs and increase productivity. He began his career with a boutique management consultancy in Los Angeles. Mr. Resh holds a degree in International Economics from UCLA and has performed extensive coursework in accounting, finance, and computer science. He currently resides in Dana Point, California. Read more
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