I’m fairly young for a financial planner. Being in my 30’s I’m technically a millennial even though I barely ever eat avocado toast, have worked a ton of manual labor jobs, and have never taken out a student loan. The fact that I’m younger doesn’t do me any favors when I’m trying to explain upside/downside capture or risk scatter plots to an investor that is nearing or in retirement. Some think my recommendations to invest in funds rather than using a CD, savings account, or annuity are informed by my perceived inexperience or higher risk tolerance.
Choosing a financial advisor is every individual person’s prerogative and I can only counter the claim that I’m young with the argument that “I’ll probably live longer than you” so often. That doesn’t help build a relationship. Yeah, I’ll probably still be alive and working by the time most of my clients retire, but simply not dying or retiring does not a great advisor make.
The bottom line in choosing an advisor is that you have to trust them. We can say our decisions are data-driven, evidence-based, and fiduciary all we want but most advisors have nothing to keep them accountable to these claims. And not only that, once you choose an advisor, most investors have no idea how much risk is actually in the portfolio their trusted advisor has built.
We want to make it easy to trust us and we want proof.
In an attempt to create an independent monitoring system for ourselves and provide clarity to our clients we’ve aligned with financial technology company Riskalyze. This company has developed ground-breaking risk analysis software that uses Nobel prize winning research to create an easy-to-understand common ground between advisor and investor. All you need to do is answer a few questions in this neat risk questionnaire and you’ll find out your risk number, which acts as a speed limit for investing. Riskalyze can analyze your portfolio in real-time and let you know if your number matches the number of your portfolio. This number will serve as a starting point in new relationships and a checkpoint in review meetings.
Do you know how much risk is in your portfolio?