Open books, more for financial advisor
Sharing all money information will lead to better planning.
You found a good financial planner to help you manage your money and achieve your goals. Congratulations, that’s a big step.
Now comes a leap — opening up about money. There’s a reason it’s called personal finance. Almost everything about your life can influence your financial decisions, so get ready to talk about more than dollars and cents.
“The more open our clients can be, the better the planning we can do for them,” says Emilie Schaffer, a certified financial planner and associate wealth advisor with Buckingham Strategic Wealth in St. Louis, Mo.
Working with an advisor goes beyond handing off financial documents. Here’s what you can and should share when meeting with a financial advisor.
“The best result is when a client is willing to share all the relevant information.” says Carl Goodin, a certified financial planner and president of Financial Planning Associates Inc. in Ellisville, Mo.
That includes even investment accounts the planner won’t manage, Goodin says. Knowing the full scope will help an advisor create a properly diversified plan.
“It’s not just looking at numbers,” says Therese Nicklas, a certified financial planner and owner of the Wealth Coach for Women in Rockland, Mass. “You want to know what those numbers are for.”
Be prepared to think through such questions as: What and who is most important to you? What do you want to do with the rest of your life? What keeps you up at night?
Clients often pause when asked these questions, Schaffer says. “They often come in thinking they’re just going to talk about retirement goals and planning.”
Your values give a financial picture color and shape. “The purpose is to get to know clients as individuals, as human beings,” Schaffer says. “There’s nothing off the table.”
“A client will say, ‘Don’t talk to me about real estate. I bought a rental property one time, and I took a big loss.’ Or ‘Don’t talk to me about stocks. I bought a stock one time, and it went down and I took a loss.’ Or ‘Don’t talk to me about bonds,’ ” Goodin says. “This allows me to address misunderstandings that may occur. My job is largely one of education.”
Says Nicklas: “Bad news doesn’t get better with age. When you hang on to guilt, the only one who is paying for that is you.”
But almost no financial matter is too big or too small to discuss, says Angela Furubotten-LaRosee, a certified financial planner with Avea Financial Planning in Richland, Wash. Should I buy or lease a car? Should I lend money to my adult child? How should I plan for retirement if I fear getting Alzheimer’s disease?
“I hope to have the kind of relationship with clients that they feel they can trust and share almost anything with me,” Furubotten-LaRosee says. “I don’t think there’s a danger in oversharing. Your life and finances are intertwined.”