Discussing finances isn’t always easy. Sometimes people are embarrassed about debt, uncertain of their knowledge, or just aren’t ready to tackle tough “what-if” topics. Your finances are deeply personal, so it makes sense that you don’t want to discuss your financial situation with just anybody. That’s why most of our clients are referred by their friends and family members—someone they trust relies on us, so they feel comfortable doing the same.
Reasons for Doubt: a Case Study
Sometimes, though, it takes a little more time to build trust. Several years ago, I started working with a physical therapist named Lisa, helping her manage her financial risks and maximize opportunities. She was single at the time, and when she married, she introduced her husband John to me and suggested we review his financial situation, too.
He was skeptical, mostly because he was used to handling his finances on his own and assumed he had everything under control. He was a do-it-yourselfer who had a general understanding of financial concepts and simply wasn’t ready to turn everything over to a stranger. That’s understandable, given the gravity of personal wealth management—but eventually, he realized he didn’t have the time, energy, or expertise to keep up with everything effectively. When John realized everything we’d done for Lisa and what great shape her finances were in, he was more open to the idea of letting us help.
How We Helped
Over time, we built a relationship with John, and we were able to support the couple in several different areas—we showed them how to merge their finances in a tax efficient way and establish a solid foundation against risks; later, we coached them through major milestones like changing jobs and buying a home.
Once we were able to review John’s investment strategy, we realized he was holding onto a lot of stocks from the company he worked for. A large percentage of his assets was invested in this one company, and we helped him realize that if the company went south, not only would he lose his job and income—he’d lose a significant share of his assets. This can be a common mistake people make with investments, usually because shareholdings just aren’t top-of-mind.
Generous stock options might sound like a great benefit when joining a new company (and they can be), but that doesn’t mean you shouldn’t consider diversify your assets. Lots of times, tech professionals and other employees with shareholdings don’t realize the opportunities they have with their stocks—that with the right planning, you may be able to better leverage these assets to establish insurance policies, pay off debt, or set up an emergency fund. By looking at the big picture and helping John integrate his stocks with his other financial strategies, we were able to help him become more diversified from what we consider essentially “free money.”
Once he saw the opportunities he’d been missing, John was convinced. But the real eye-opener came a little while later…
After we’d worked with the couple for a while, Lisa was injured and couldn’t work for about a year and a half. But thanks to a disability policy we’d set up before she and John ever met, she used her benefits while she couldn’t work, and they were able to maintain their income and the lifestyle that came with it. If Lisa hadn’t trusted us when we suggested disability insurances years before, she and John might have had to drastically change their spending habits or even sell their home—but because we planned ahead, they were much better protected during this event.
It Takes Time
Choosing a financial advisor is a big decision, and it’s one you shouldn’t take lightly. That’s why it’s a great idea to ask people you trust for recommendations. And if you’re still skeptical, give it time. Learn more about the financial advisor and let them learn more about you. Ask lots of questions. Most firms, ours included, offer a complimentary introductory call so you and the financial advisor can make sure you’re a good fit for each other before committing to anything—which can alleviate some of the stress of hiring someone to manage your finances.
Bottom line—great financial advisors are always looking out for your interests, and they won’t shy away from someone who wants to do his (or her!) research.
That said, if someone you trust wholeheartedly (like your spouse) says you can trust their financial advisor, that’s a good indicator that the financial advisor has your interest at heart. And when that financial advisor tells you they can help you avoid potential danger and create a better future, they’re probably right.
Dave works with hundreds of Bay Area dentists, physicians and their families. He has a deep understanding of the financial needs of the medical/dental practitioner. He makes planning simple and clear by coordinating both business and personal finances for his clients.
He also works with Silicon Valley executives, professionals, and their families.
All scenarios and names mentioned herein are purely fictional and have been created solely for training purposes. Any resemblance to existing situations, persons or fictional characters is coincidental. The information presented should not be used as the basis for any specific investment advice. Individual situations and results will vary. 2021-129895 Exp 11/23