“It makes me wonder if we’re in the right relationship.” Our financial advisor is one of the “top performers”, but she costs well over $20,000 a year, even when we are losing money. Should we get a new one?

How to know if your financial advisor is worth it.

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Question: After our first financial advisor retired, we selected a new one recommended by her to continue our relationship with the company. Our fixed rate fee of $1,700 per year has decreased to 0.9% of our assets under management. This meant that the fees were around $20,000 per year. This year, we added well north of $1 million to our investments from a legacy. But our advisor still won’t accept flat fees or lower percentage fees. Yes, our advisor is one of the top performers, but like everyone else, our portfolio is taking a hit this year and the fees will be well over $20,000. Should we aim for a flat fee even if it means changing advisers? The 10 or 15 times the original annual flat fee makes me wonder if we’re in the right relationship. (Also looking for a new financial advisor? You can use this tool to be connected with a financial adviser who could meet your needs here.)

Answer: The answer isn’t simple, but let’s start with the 0.9% fee, which the pros say is pretty standard in the industry. But that doesn’t mean it’s not worth digging deeper into by looking at what it really does for you for those fees, and whether someone as good could charge significantly less. “For 0.9%, it’s better for the advisor to provide comprehensive planning, otherwise you’re paying way too much for something that can be done for a fraction of the price,” says Chris Russell, Certified Financial Planner at Tempus Pecunia. Adds Certified Financial Planner Ryan Townsley of Town Capital: “As an advisor, I am willing to honor your fee schedule with very few exceptions. It doesn’t mean your advisor is delivering value that’s worth the fee. Paying such high fees should have enormous value,” says Townsley.

Do you have a problem with your advisor or are you looking for a new one? Email picks@marketwatch.com.

For his part, Certified Financial Planner Michael Miller of Miller Premier Investment Planning says, “You should consider the services rendered by your advisor when evaluating whether or not to dispose of them. Some financial advisors offer a very comprehensive list of planning services as part of their package: estate planning and document preparation, tailored structured notes, tax planning, risk management, retirement income planning, and even business planning. .. In the end, you’re the one who really holds all the cards because it’s up to you who you hire. If you feel your advisor isn’t providing the services and expertise for the price you’re paying, you have the freedom to shop around. »

Are you also looking for a new financial advisor? You can use this tool to be connected with a financial adviser who could meet your needs here.

Plus, your advisor doesn’t seem as willing to work with you as they should, say the pros. “Do you want to be in a relationship where the answer to a request is an emphatic no? There are lower-cost counselors who offer flat fees,” says Russell. Indeed, a flat fee may be worth considering. When looking for a new advisor with a fixed fee, certified financial planner Kaleb Paddock of Ten Talents Financial Planning, says you should ask a new advisor how many hours they actually spend working on each client over the course of a year. a given year “How many meetings do you have with them per year? Does the advisor do tax planning and beneficiary planning? Do they offer advice on asset allocation to help you hold the right investments in the right tax-advantaged accounts?You’ll get more value from thorough planning than just trying to find a high-performing performer who only focuses nt on investments,” says Paddock.

And Townsley notes that an advisor should always be earning your continued business, and also points out that asset-based fees should come with fee reductions as your portfolio grows. “You don’t have to double the work to manage double the money, so a tiered fee structure is the most appropriate. My best advice is to get a second opinion,” says Townsley.

No matter who you go with, the pros may want to interview 2 or 3 other people, or even more if necessary, to find someone who will deliver and make you feel like the expense is worth it. Here’s a guide to questions to ask any advisor you might want to hire.

Do you have a problem with your advisor or are you looking for a new one? Email picks@marketwatch.com.

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