What You Should Know About Communication with Your Financial Advisor

Jeff Vistica
CFP®, ChSNC®, AIF®
May 21, 2024

As a financial advisor, maintaining clear and effective communication with clients is one of the most critical aspects of my job.

Here’s what you should expect regarding communicating with your financial advisors and how setting the right expectations can lead to a more productive partnership.

The Importance of Communications

Communication with financial advisors is essential because it helps build a robust relationship based on trust, transparency, and mutual understanding.

Effective communication ensures you receive the necessary guidance and support to achieve your financial goals while advisors stay attuned to your changing needs and priorities.

Establish Communication Preferences

Financial advisors should accommodate your communication preferences within reason, including establishing the frequency of communication that works best for you.

Flexibility in catering to your preferred communication style can help ensure a productive and comfortable advisor-client relationship.

Establish the frequency of communication that works best for you. Your advisor should determine a communication schedule that keeps you informed without becoming annoying.

Prepare for Meetings

To make the most of your meetings, come prepared.

Before each meeting, review your financial situation and jot down any questions or concerns you may have. This will help you stay focused and address all the critical points during the meeting.

Share any relevant updates about your financial situation, like changes in income, expenses, assets, liabilities, or any significant life changes that may impact your financial plans. This will help your advisor provide the best guidance tailored to your current situation.

Your financial advisor should come to meetings prepared with updates on your portfolio, market insights, and other relevant information. They should be ready to answer your questions and provide guidance.

Your advisor should proactively ask for updates on your situation and any changes to your goals.

Understand Complex Concepts

Financial advisors should communicate complex topics to clients in plain language, using examples and analogies you can easily understand. They should avoid technical jargon and industry-specific terms that can be confusing.

Financial advisors should encourage you to ask questions and provide ample time for discussion and clarification.

A good advisor will use visual aids, like charts and graphs, to help you better understand complex concepts.

The goal is to ensure you are comfortable and current so you can make informed decisions that align with your goals.

Address Concerns and Challenges

No matter how carefully you plan, challenges will arise. When this happens, your advisor should be your first contact for guidance.

Whether you're facing a job loss, market downturn, or unanticipated expenses, your advisor should help you navigate the situation and adjust your plan. They should proactively reach out during times of volatility to provide reassurance.

Maintain Transparency

Transparency is essential. Your advisor should be upfront about fees, compensation structure, and potential conflicts of interest. They should provide regular updates on your portfolio's performance in clear, easy-to-understand language.

Understanding your advisor's fee structure is especially crucial. Whether it's a flat fee, an hourly rate, or a percentage of assets under management, knowing how you're being charged will help you assess the value you're receiving.

Transparency about costs ensures no surprises, so you can focus on reaching your financial objectives.

If you have concerns about the management of your account or the advice you're receiving, your advisor should openly discuss these issues and work to find a resolution.

Adapt to Changing Needs

As your life evolves, so will your financial needs and priorities. Your advisor should adapt their approach as your situation changes, adjust your investment strategy, update retirement plans, or explore new opportunities.

Regular communication ensures your advisor stays attuned to your changing needs. Keep them informed about significant life events or shifts in your goals.

Respect Boundaries

Financial advisors and clients should respect each other's boundaries by maintaining open and frequent communication during regular business hours and avoiding excessive contact outside of scheduled meetings.

Advisors should refrain from offering unsolicited advice on personal matters and should not push clients to make uncomfortable decisions.

Clients should respect their advisor's time and professional expertise.

Final Thoughts

Effective communication with your financial advisor is crucial for achieving long-term financial goals. You can build a strong partnership rooted in trust and mutual understanding by establishing clear expectations, preparing for meetings, understanding complex concepts, addressing concerns, maintaining transparency, adapting to changing needs, and respecting boundaries.

Your financial journey is unique, and your advisor is there to guide you. Don't hesitate to reach out, ask questions, and voice any concerns. Together, you can navigate the complexities of financial planning and make informed decisions that align with your aspirations.

Phone Icon
Let's start planning together, call 760 854 4003