The Right Advisor For You

Transcript

Mike:

Hi everyone. Michael Reese here certified financial planner, founder of the prosperity planning system. The system that helps you enjoy financial prosperity, no matter what the world brings your way today, we are going to talk about the difference between financial advisors. It’s a question we get all the time. You’re going to love this.

Mike:

All right, everyone today, we’re talking about the different financial advisors, and this is really important that you understand that because you want

Mike:

To make sure that you’re working with an advisor, the matches up to what you want them to do. If you don’t have the right advisor, that can cause all kinds of problems. Of course. Now, before we dive into this again, if you like our content, give me a thumbs up below. Subscribe, leave a comment. Always be nice. And if you want to talk to me or the team, we have a little link below. It’s called talk to mike.com. It’s just a link to our online calendar. You click the link. You go to the online calendar. You set up a quick 15 minute introductory call, easy peasy. All right, let’s dive into today’s topic. Understanding the difference between financial advisors. So you can pick the right one for you. Now, I want you to think about a pyramid here and in this pyramid, we’re going to have three levels, K three levels.

Mike:

Now the bottom level or level one, those are the product providers. Now I want you to think about it this way. Think about the general life cycle that you go through when it comes to your investing life. When you start out, I mean, heck my daughter, Sarah is 27. Sarah is 27. I have five kids. There’s the oldest, but she’s 27. And my son Taylor, 25, they work in the company. Now in our company, we have a 401k plan and that’s what they do for their saving. Right now. They’re just adding money to their 401k plan. They are working directly with what we call level one product provider that might be fidelity or Schwab or TD. The purpose of a product provider is to give you access to investments, but they give you a little bit of help. But for the most part, you’re kind of on your own, right?

Mike:

So here you are, you’re in a 401k, you’re kind of picking your funds. That’s a product provider. If you’re a do it yourself or investor, you know, you might use a product provider to give you access. And you’re kind of making your own investment choices. That is a wonderful place to start. And it’s a wonderful place. If you are a do it yourself or on the investing side, then for most people though, what happens is you start using investing in, investing in your 401k and eventually a day comes where you look at your account balance. You’re like, Holy cow, this thing’s getting pretty big. Maybe you start thinking maybe you need some help with your investing. It’s time to bring in some professional help. That takes you up to level two, which is the investment advisor. Okay? The investment advisors at level two, their job is to help you make good choices with your investing.

Mike:

And that’s about it. If you ask them for tax advice, yeah. That’s not what they do. They send you to, you know, maybe a tax person. If you ask them for advice with your insurance again, not really what they do, they send you somewhere else and so on. And so on. They really focus in on investing. Now, typically they have what’s called a template approach. And what that means is they have all these different models. And when you work with them, they ask you questions about your risk profile. Like, Hey, how much risk are you comfortable taking and so on and so on. And then they put you in one of those models based upon your answers, a wonderful place to be. If all you need is investment help. So here you go. We started out when we started out investing level one product provider, we started to grow a bunch of money.

Mike:

Now we’re at level two, a investment advisor, Oh, by the way, I forgot to say investment advisors. They’re usually compensated by either fees or commissions. And guess what? They’re probably going to cost you more money than the product provider, because they’re providing you with a service. You would expect that, okay, now maybe you’re getting closer to retirement or now you’ve really starting to get a pretty good amount of money. And now you’re starting to get worried about, or you’re asking questions anyway, about things. It’s like, well, what about taxes? What do I do there? What do I do about long-term care planning? When should I take social security? How should I structure my income? So that work is optional. You starting to ask some more in-depth questions and that’s what brings you up to the top of the pyramid. The level three advisor level three advisors are your holistic planners.

Mike:

They’re your true financial planners. They help you in a lot of areas outside of just investing. For example, in our office, we’re holistic planners. We provide something called a prosperity planning model. And that means we help you make decisions on your investing on your income planning. So you can make work optional on your insurance planning for like health insurance, you know how to handle health care expenses. We help you with things like estate planning, right? How do you take care of your family when you’re gone and tax planning? All of these need to be brought together in a cohesive whole. And if you’re at that level, then that’s kind of advisory you’re looking for now again. Guess what? Just like your investment advisor level two advisor, maybe they cost a little more than the than the product provider, because they’re offering a service, same thing, a holistic planner.

Mike:

You should expect. They’re going to cost you a little bit more than an investment advisor because they’re doing a lot more for you, but there you go. That’s your pyramid level one, two, and three different types of advisors in the financial world. You want to make sure that you’re connecting with the one that best fits you and where you are in life. So don’t expect, for example, a level one advisor, like a product provider to give you the same advice that investment advisor might give you and so on. All right, those are three levels. I hope you found that helpful again, you like this video, click the like button below, subscribe, leave comments. If you’d like to talk to us about what working with a level three advisor looks like. You’re welcome to click the link below. Talk to mike.com set up a 15 minute introductory call. We look forward to talking to you and helping you enjoy that prosperous life.

Leave a Reply

Your email address will not be published. Required fields are marked *

© 2021 Centennial Advisors LLC ยท