5 Things Your Financial Adviser Wishes He Could Tell You

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Whether it’s spending frivolously, refusing to save for the future, or clinging to the belief that we’re somehow immune from a money disaster, many of us seem to have no trouble devising ways to screw up our financial future. Some might even look at statistics about our total credit card debt and dismal savings rate and say that courting financial disaster is something that Americans excel at, in fact.

Financial advisors are supposed to help. These trained professionals are a bit like MDs for your money. They guide you to make smart decisions about your wealth and help find a solution to your troubles when times get tough.

But just like a doctor can’t really help a sick patient who refuses to follow a treatment plan, financial advisers can’t help with your money problems if you don’t listen to them. Sometimes, their most important messages seem to fall on deaf ears. In other cases, they might need to couch the hard truth in gentler language in order to make it easier for a person to swallow.

We wanted to get to the truth about what financial professionals are really thinking, so we asked a few about what they say to their clients when they’re being completely honest. Whether it’s forthright advice about planning for the future or stern words about Social Security, here’s what they shared with us.

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1. You shouldn’t DIY when it comes to Social Security

“Social Security filing is not a DIY project,” Willie Schuette, a financial planner at the JL Smith Group, told The Cheat Sheet. “This is one of the biggest mistakes most people make, filing without getting any information from a qualified professional. Chances are, if people consult with an expert they would receive more money over the long-term and be in a better financial shape for retirement.”

Rick Foster, the president of Guardian Financial Management, has had similar experiences. “I get people all the time who want to take their Social Security benefits at age 62 rather than wait till their full retirement age,” he told The Cheat Sheet. “Unless you have a chronic illness or the longevity in your family is just unusually short, taking your benefit early could cost you. This could be one of the biggest financial decisions you make in your entire life. Don’t base this decision on some advice from your brother in-law or neighbor.”


2. You need to think with your head, not your heart

Making big money moves based on how you feel rather than cold hard facts is a recipe for disaster, many advisers say.

“Anytime someone is emotional about investment decisions, they’re setting themselves up for disappointment or to lose money,” Jennifer Landon, founder and president of Journey Financial Services, told The Cheat Sheet. “Make sure you’re basing your decisions on facts, not emotion.”

Thinking rationally is important even in emotionally charged family situations, such as when a child or other family member who might inherit your money is struggling with addiction, said Schuette.

“You are going to kill them if you leave them all this money,” he said. Rather than simply giving them a pile of cash, Schuette suggests putting the inheritance in a trust.

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3. If you’re part of a couple, you need to work together

Marriage is a partnership, yet many couples don’t seem to get that, at least when it comes to money.

“Every week I meet with couples where one spouse enjoys studying the stock market. Each morning they are eager to see how their strategies are working,” said Foster. “If the spouse who is actively monitoring the market were to pass away unexpectedly, would the other know what to do with those stocks? Usually, they do not.”

When one spouse makes all the financial decisions, that puts the other at a distinct disadvantage, he explained.

“You are jeopardizing your spouse’s retirement. If you do not explain what you are doing with the family’s finances, and if you have not planned for some type of guaranteed income for them after your passing, there is a chance the bills will not get paid.”


4. You’re being too reckless

It’s fine if you want to live on the wild side, say advisors, but don’t do it with your money.

“I have had many retirees come to my office with high-risk investments appropriate for a 20 year old,” Jim Heafner, a certified financial planner and president of Heafner Financial Solutions, told The Cheat Sheet. “Unfortunately, they have no plan to protect their money from the damage that market volatility can do as they withdraw their monthly income.”

“Some people crave risk, even to their detriment. They need excitement,” Heafner said. “I would like to say, ‘If you could ever give up the adrenaline rush you get from gambling with your retirement investments, we could create a plan that would virtually secure your success. Let’s protect your wealth; Go jump out of a plane for excitement.’”

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5. You need to get it together – now

Procrastination is the enemy of financial freedom. Putting off saving or banking on things ‘just working out’ could mean you’ll eventually end up in the poorhouse.

“Despite the emphasis traditionally given to investment management, the biggest things that get most people into financial trouble is lack of planning and poor decision-making,” Chad Creveling of Creveling & Creveling Private Wealth Advisory told The Cheat Sheet. “Start building financial security early. In today’s world, you cannot rely on your income increasing throughout your working life, having a job, or choosing when you will retire.”

Once you commit to preparing for the future, stick to your plan.

“Discipline and perseverance are critical,” he said. “These qualities are really underrated when it comes to achieving financial security.”

Follow Megan on Twitter @MeganE_CS

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