Trust the Financial Advisor Who Knows When to Say “No”

Early June marked a dramatic change in the financial industry. All financial advisors are now legally compelled to work with the best interest of the client in mind, as fiduciaries. Despite this, you still have to look out for the advisors that truly work in your best interest instead of just trying to make you happy in the short term.

A Difficult Scenario

Financial advisors can be put into some difficult scenarios. Advisors want to work in your best interest, but what happens when a client wants something that may go against their long-term best interests? For instance, buying new toys, investing in high-cost, low-reward ventures, buying IPO’s, overtrading, or any other decision that may be against your clients’ best interest.

The Last Thing You Need is a “Yes Man”

It can be the hardest thing in the world to go against someone who’s paying you, but an advisor worth her salt will “Just Say No”. While some fiduciaries believe that working in your best interest means giving you anything you want, your true best interest can be at stake. You have an advisor for a reason.

Why to Trust the Advisor Who Says “No”

Never pay someone to just agree with you. You deserve real advice. When advisors just do what you tell them, they aren’t living up to their job, they aren’t giving you advice. You should look for an advisor who can truly challenge certain investments and schemes. Your advisor needs to be the following:

  • A professional, working under fiduciary standards, in your best interest, even if that means saying “no.”
  • Unwilling to simply follow orders
  • The type of person who won’t just tell you what you want to hear.

The Client’s Side of the Deal 

A client seeks a financial advisor to help save for their future. If you trust your advisor, you should trust your advisor. If you don’t, save your money or find a new one. Its important clients don’t just look at advisors as middle men for their savings, but as a resource with quality advise and experience. Clients should:

  • Not use financial advisors as “sounding boards.”
  • Not rely on confirmation bias to make financial decision.
  • Not blame advisors when they miss good opportunities or pursue bad ones.

Without fiduciary standards, financial advisors were free to promote products and services that benefit themselves at the expenses of their clients.  These new rules are meant to protect the client, to guarantee an advisor works in that client’s best interest. However, clients should still be on the lookout for advisors who still know how to say “no.”

Check the background of this investment professional on FINRA’s BrokerCheck

Advisory services offered through EWG Elevate, Inc. dba Protection Point Advisors.

This represents a partial list of clients. They have not been compensated and were not selected based on duration, performance, account size.