A Financial Advisor Should Provide You With a Great ROI
Financial advisors can be amazing....or disappointing. An amazing one should specialize in your needs and deliver 2-5x (or more) in value
Last updated
Financial advisors can be amazing....or disappointing. An amazing one should specialize in your needs and deliver 2-5x (or more) in value
Last updated
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The financial planning industry is like the medical industry — comprised of both generalists and specialists. General practitioners are good for the basics, but if you have a heart condition you see a Cardiologist -- period.
As a tech professional, your financial planning needs are complex and you need a specialist (not a generalist). For example, at 30-40 Wealth our software, tooling/frameworks, expertise, and more are custom-focused on the unique needs of tech professionals (and their stock comp, financial plans, investment portfolios, and more).
With the 99% of advisors who don’t specialize in tech workers — many might need to google how an ISO differs from an NSO. Nothing against them; most are likely amazing in their specialized vertical (e.g. Retirees, Traveling Nurses, Law Firm Partners, etc.). That could make them a great advisor for your parents/aunt/cousin/best friend, but a poor fit for you.
If you've never worked with a financial advisor before, understanding the value you'll get partnering with them on your finances may be opaque to you. To help you improve your decisioning and bring clarity to the "ROI question", we created the framework below. It’s adaptable and unique to each individual/household, because planning is inherently unique and personal. But functionally, it focuses on three key elements across a few categories:
Where are you on the TIE Rule (time, interest, and expertise) in regards to wanting + being able to do this yourself?
How complex is your situation, and how would you qualitatively value an expert providing you with answers, advice and an actionable plan (today + in the future as your life changes)?
What is your stock-comp, investment, tax, and behavioral strategy — and how much quantitative value will an advisor add for you by improving things?
When you meet with a prospective advisor, treat it just like you would a prospective employer and ask good questions. You’re seeking to partner with them on your finances— and you want to understand their specific experience, processes, philosophies, and service model. A few smart questions (that we at 30-40 Wealth love hearing from well-prepared prospective clients) are:
| Question to Ask | What You Want to Learn |
|---|---|
How many clients have you helped solve <<insert your pain point(s)>> | Do they have strong experience/lots of reps doing this for other individuals? |
How would we work together to solve <<insert your pain point(s)>> | Do they have a well-thought-out process (potentially event template docs/tools) to help guide you through a decisioning process? |
Based on what you know about my/our situation, what are the top 2-3 highest priority items you'd recommend we focus on? | Does their assessment align with your priorities and needs? |
How can/should I assess the value that you'll provide to me/us? | Have they deeply thought about what the value you will get working with them (vs what they will get from you)? |
