Perspectives

The Seven Key Roles of a Financial Planner

Prepared by Brian Hinson bwhuntsville_officeimg_2943

One common view many individuals have when they initially meet with an advisor is that we as financial advisors have unique insights into market direction that give our clients an advantage. But of the many roles we at Bridgeworth are honored to play as trusted professional advisors, soothsayer is not one of them. The truth is that no one knows exactly what will happen next in investment markets whether we are facing an upcoming political election or experiencing a period of significant economic growth. And if anyone really did have a working crystal ball, it is unlikely they would be plying their trade as an advisor, broker, analyst, or financial journalist.

Other individuals may still think an advisor’s role is to deliver market-beating returns year after year. Generally, those are the same people who believe good advice equates to making accurate forecasts. But in reality, the value we as advisors bring is not dependent on the state of markets. Actually, our value is often even more evident when volatility and emotions are running high.

Our value proposition at Bridgeworth that separates us from many other advisory firms is represented by the multiple and nuanced roles we play with our clients. None of these roles involves predicting the direction of markets or the future state of global economies. Instead, there are at least seven hats we wear at different times to help our clients without ever once having to look into a crystal ball:

  1. The Expert: Individuals, families, and businesses need trusted advisors who can provide client-centered expertise in assessing the overall state of their finances while developing a comprehensive, financial plan with risk-aware strategies to help them meet their goals.
  1. The Independent Voice: The global financial turmoil of recent years demonstrated the value of an independent and objective voice in a world full of product pushers and salespeople.
  1. The Listener: A worthy advisor will listen to clients’ fears, determine the issues driving those feelings, and provide practical, long-term answers.
  1. The Teacher: Getting beyond the fear-and-flight phase often is just a matter of teaching our clients about risk and return, diversification, the role of asset allocation, and the virtue of discipline. 
  1. The Architect: Once these lessons are understood, the trusted advisor becomes an architect, constantly monitoring and building the long-term wealth management strategies that match each client’s risk appetites and lifetime goals.
  1. The Coach: Even when the strategy is in place, doubts and fears inevitably arise. At this point, the advisor becomes your coach, reinforcing principles first and keeping you on track.
  1. The Guardian: Beyond these experiences is a long-term role for the trusted advisor as a kind of lighthouse keeper, scanning the horizon for issues that may affect our clients and keep them informed.

These are just seven of the valuable roles we as advisors can play in understanding and responding to our clients’ holistic needs, which are a world away from the old notions of selling product off the shelf or making forecasts.

Knowing that we are trusted, independent advisors, acting as fiduciaries at all times —and not plugging product as unfortunately many advisors often do—leads us to work diligently to grow that trust and be seen as a listener and sounding board. From that point, we as listeners can become the teacher, architect, coach, and, ultimately, the guardian. Just as people’s needs and circumstances change over time, the nature of the advice we provide constantly grows.

No matter how you characterize these various roles, competent financial advice ultimately is defined by the patient building of a long-term relationship founded on the values of trust, independence, and knowledge of each individual, family, and business.

Adapted from “The Seven Roles of an Advisor” by Jim Parker, Outside the Flags column, May 2015. Diversification does not eliminate the risk of market loss. There is no guarantee investment strategies will be successful. Past performance is no guarantee of future results. All expressions of opinion are subject to change without notice in reaction to shifting market conditions. This content is provided for informational purposes, and it is not to be construed as an offer, solicitation, recommendation, or endorsement of any particular security, product, or service.  

Bridgeworth, LLC is a registered investment adviser.

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