How Does a Financial Advisor Add Value?
There is a myriad of financial professionals providing different services with different compensation structures and often with embedded conflicts of interest.
How can you make sense of it all? Does a financial advisor add value? How do you select a financial advisor that fits you?
How Can Value Be Quantified?
About 25 years ago, Vanguard’s Investment Advisory Research Center partnered with financial advisors to quantify the value they add. This value is called “alpha”. It is the extra benefit you should get from working with wealth management advisors like us.
In 2014, Vanguard put a number on it. This is the added value above and beyond the advisor’s percentage fee. Their seminal research paper Putting a Value on your value: Quantifying Advisor’s Alpha found that advisors can potentially add up to or exceed 3% in net returns by using Vanguard Advisor’s Alpha framework.
How Does Skyline Advisors Add Value?
We try to answer that question by starting from a place of genuine care and trust. The human component of our services is integral to who we are. We provide professional financial services personalized for you, not packaged for you.
We add value by helping our clients with asset allocation, investment selection, rebalancing, tax smart planning, retirement income, estate and legacy planning, and behavioral coaching during periods of market volatility. We add value by potentially making your life easier so that you can have freedom and fulfillment.
Where Does Skyline Advisors Add Value?
This framework is an important part of Skyline Advisors’ value-add and it can be broadly categorized into three buckets: Investment Management, Financial Planning, and Behavioral Coaching.
Investment Management: We add value by minimizing expenses, prudent asset allocation, smart rebalancing and control of risks, disciplined trading, adapting to changing market conditions, and a focus on tax efficient investing.
Financial Planning: We add value by providing a framework for a fulfilling retirement where you can pursue your dreams. This is comprehensive because we look at your tax planning, charitable endeavors, your retirement income, your legacy and estate, and identifying planning opportunities and pitfalls. But perhaps even more important is the actual execution of this advice on an ongoing basis. This is often what is missed when you contract with a financial planner to provide “planning only” for a fee.
Behavioral Coaching: Good investing and planning is often defined by what not to do. Mistakes are hard to recover from and we can help mitigate these through decades of experience.
Your Time is Valuable
We can add value by managing your financial matters so you can spend your time on other things. Clients hire us to delegate their financial worries to someone else. Clients hire us because one member of a married couple is aging and not quite as able to handle their household finances and wants a trusted advisor. Time is a diminishing resource. Clients hire us to buy themselves more time to pursue fulfillment. Often, value is not so easily quantifiable. We don’t need to see oxygen to feel its benefits.
You can find Vanguard’s article and paper on Advisor’s Alpha on there website.
How Do You Find a Financial Advisor?
This really depends on what services you need. I’d suggest educating yourself and search for financial advisors in your area and exploring their websites. Look at their team, their services, and read through any FAQs or Blogs they may have. Ask people you trust who they use?
You can CFP® Professionals on www.letsmakeaplan.org
Skyline Advisors is independently owned and operated and have built in our fiduciary values into our services and structure. If you would like to learn more about our services and how we can help you, contact us.
The content of this blog is for informational purposes only and should not be construed as investment, tax, or estate planning advice. Skyline Advisors, Inc. is an SEC Registered Investment Adviser. Advisory services are only offered to clients or prospective clients where representatives of Skyline Advisors, Inc. are properly licensed or exempt from licensure. If indices are referenced in marketing material, it is important to note that these cannot be invest in directly, any vehicle such as Passive index-based ETFs and Mutual Funds which attempt to replicate indices have internal expense ratios and other associated costs that would negatively impact returns. No advice may be rendered unless a client service agreement is in place. Past performance is no guarantee of future returns. Investing involves risk and possible loss of principal capital.