With a nod toward Mr. Foxworthy, and full recognition that this list lacks any humor whatsoever: You might need a new Financial Advisor if:
- Individual stocks comprise a large percentage of your portfolio.
- The fees on the mutual funds you own average more than 30 basis points (3/10 of 1%).
- All of your mutual funds are run by the same company (e.g., American Funds or Vanguard).
- Each of your accounts – taxable and/or qualified – has essentially the same stock/bond allocation.
- The annual fee charged by your Advisor is more than the fee(s) charged by your fund manager(s).
- Your Advisor isn’t a full-time fiduciary.
- There is frequent trading in your account.
- Your portfolio “tilts” toward growth stocks, rather than value stocks.
- You don’t have an Investment Policy Statement.
- There isn’t a clear link between your financial plan and your investment strategy.
- Your Advisor sold you a whole-life insurance policy or a variable annuity.
- You are invested in things you don’t understand (like hedge funds).
- You don’t know how your portfolio’s performance compares to its benchmark.
- You have no idea what a “Target Allocation” is.
- Your Advisor hasn’t explained to you the benefits of “Evidence-Based” Investing.