I Want to Break Up With My Financial Advisor. Now What?

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Not happy with your financial advisor? Read on to find out what to do. 

It’s estimated that 32% of Americans use a financial advisor, according to data from intelliflo. And working with one offers several benefits.

A financial advisor can help you better manage your money and work toward your financial goals, whether it’s buying a house or saving for retirement. Working with a financial advisor can also give you more peace of mind that you’re investing in an efficient, appropriate manner given your age, appetite for risk, and objectives.

But there may come a point when it’s time to cut ties with your financial advisor. Maybe you’ve realized you’re being charged higher fees than average. Or maybe your financial advisor is hard to reach and doesn’t explain things to you the way you’d like them to.

It’s very important to be happy with your financial advisor and to feel like you’re getting good service from them. So if that’s not the case, you shouldn’t hesitate to sever that relationship. Here’s what that might entail.

Have an honest conversation

In many cases, breaking up with your financial advisor is really a matter of having an honest conversation and explaining why things aren’t working out for you. A good financial advisor will bow out gracefully and help make the transition to a new advisor as smooth as possible.

Now, your financial advisor may try to offer to change their ways and get you to stay on board if the issue at hand is something like communication. But if the issue is fees, and your advisor knows they won’t budge on those, then they may be more likely to accept your decision and help you move on.

From there, it’s a matter of deciding what to do with your assets. Your financial advisor might have your assets at a well-known brokerage already, and you may have the option to keep your portfolio where it is and manage it yourself.

However, if you’re moving over to a new financial advisor, they might have a specific brokerage they want you to work with. So in that case, you might need to open a new brokerage account and work with your old financial advisor to get your assets transferred into that new account.

You may, in some cases, face a small fee for moving your assets over. Often, this won’t be the case, though.

You should also know that in some cases, you may need to cash out investments if your financial advisor has your money in a proprietary investment product they oversee. That could have tax implications. If you have an accountant you work with, they should be able to help you figure out what those might entail. Or your old financial advisor might give you the courtesy of walking you through them.

A tough move you might need to make

There’s no point in continuing to work with a financial advisor you feel isn’t serving your needs or is charging you too much. If that’s where you’re at, have that conversation so both you and your financial advisor can move on.

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