SPEAKER_00 0:06

Hey everyone, welcome to the podcast. We're going to talk about your advisor today. And your advisor might be me. So these are questions you can ask me. I want to focus on the advisor because we're more than halfway through the year. The last podcast that we've done, and you might have listened to was about our tech stocks in trouble. And the tenor of this podcast, generally speaking, is heavily weighted to investments because they're very emotional. We've actually done podcasts on that. I think taxes are a close second. You know, people get very emotional about taxes. I know I do. I don't want to pay any. You know, but when it comes to other things, like whether it be insurance or cash flow management or um, you know, there's a litany of things that we do for clients, build, you know, establishing legal documents. Sure, there's a little emotion in that, but the reality is those things are like done once and then you don't really think about them that often. Uh in passing, you do maybe in an annual review, you might look at your legal documents and your liability insurances and life insurances and your mortgage statements and that kind of thing. But those things aren't on your mind constantly, not nearly as much as the investment portfolio is. It's just in your face all the time. Um, and I think taxes, like I said, are kind of a close second. You know, they pop up many times through the year. If you're a business owner, you're doing it quarterly, maybe, um, or maybe in October, you know, if you're W-2, it's usually April. But it comes out. Um, the reason why I'm kind of keying in on the emotional part is because that will wreck you. Um, if you operate on your financial plan or your investment strategy or your retirement income planning, if you do that, if you build it on emotion, you're gonna get in trouble. Um, so you know, I don't expect any of my clients and myself included, like I am my own client. And I have an advisor that I run things by all the time. You know, when Jamie and I, when we're looking to do things, like we're thinking about adding a pool right now. Uh, I'm gonna run that by somebody. I'm not gonna make that decision on my own. I know the numbers. The numbers are the easy part. Uh, I know where to get the money. That's the easy part, at least for me, you know, because running my own balance sheet. But the emotional part, like what am I missing? Um, who is going to give me real advice and tell me no if it's a bad idea and explain why? That's what I'm looking for in an advisor. And so, you know, today that the title of the podcast is Is Your Advisor a Weak Link? Now, I don't mean this to be negative, but I honestly don't really even care if it does come across negatively because I'm I'm in the business of saving people from, you know, infinite damage to their portfolios and their balance sheet. That's what I do. My job is to remove worry from my clients' lives. Like we've talked about it before. Let let us worry for you. That's our job when it comes to finance. If you have an advisor who is a weak link, uh, or sometimes I call them a chameleon, uh, I do a lot of coaching for advisors. I do a lot of speaking around the country. And again, it sounds so negative, but I I will get questions from the audience from advisors, and and they're asking me questions where I can read behind the question. The question is, yeah, but what if my client really, really wants to speculate and gamble with their money? Do I let them walk out the door? Yeah, but what if my client just does not want to do the right thing on taxation? Do I do I lose that client over that? My answer is yeah, you do. You do. Otherwise, you're a chameleon, right? Otherwise, it's a bait and switch. Otherwise, you're not an advisor, you're maybe a salesperson. And that's not what we're doing. Um, and so I've put together, I just kind of randomly typed out some questions here that I would ask an advisor. If I was, if I knowing everything I know, but if I wasn't in this business, what would I ask an advisor? Now, the the funny thing is, if you if you kind of like Google this or you look on the internet, they're gonna they're gonna tell you things like, you know, ask your advisor if they're a fiduciary. It is such an overused thing, not because we're not fiduciaries, we are, but that doesn't tell you much. In fact, a lot of clients don't even really understand what that is from a legal standpoint because our industry has has had so many different uh legislations around that, and it spans over many, many different administrations, actually. So the Obama administration had one take on it, and the Department of Labor was the one that ran that. And then we were gearing up for what we thought was going to be a uh a Clinton administration, and they had another take on the DOL and fiduciary standards, et cetera. And then the Trump administration actually took over and that changed things, and then the Biden and now Trump. So it it flip-flops a lot, right? So even those fiduciary standards, I just don't think that the average client, I don't really think that tells you much. So here's what I would want to know. And and if you're a client of mine, ask me these questions. Some of you have, and for a lot of you, I just lead with it and tell you. Um, if you're not a client of mine, ask these questions. I mean, these are things that are completely legitimate, and these are just some of them. Um, and in no particular order, I would ask, you know, look, how long have you done this? Now, this isn't fair. It's just not because 23-year-old Joe, when I first started out, you know, look, I wanted to be in this career and I wanted to be phenomenal. And the only way I was going to be phenomenal is if I did it for 20, 30 years, like I have. And so you got to start somewhere. I'm not saying a young advisor can't be a phenomenal advisor. Uh, but look, wisdom is information and experience when they collide. And you need wisdom from an advisor. You you can't have somebody who has no experience, it's very difficult for them to navigate. So, look, if your advisor is young, I would maybe ask, okay, well, you know, who is your mentor? How long have they been doing it? That's a fair question. If you've got an advisor, like, you know, say I was 27-year-old Joe, I was four years in the business, that's not a long time. Well, Joe, who is your mentor? And the people that taught me, I mean, they had been in the business, one gentleman was in the business almost 40 years at that point. If the advisor says, Well, I've been doing this for four years and my mentor's been doing it for three, I'm not telling you not to use that person, but you might want to think that through. You need wisdom when it comes to emotional things around money and how you're gonna build this balance sheet for your for your family. Um, here's a great one. What is your investment philosophy? Again, I'm not trying to be negative here, but this should not be difficult for an advisor to answer. If there is any hemming and hawing around what is your investment philosophy, I would tell you, I would run. Um, because if they don't have a very easily narrated investment philosophy, then there is none, right? It's it's whatever's kind of in the news that day. And and you can you can you can really get damaged that way. We've seen it, you know, and over 30 years, we've seen it, we've seen fancy products, we've seen different tax plays, we've seen tech stocks and internet stocks, and we've we've seen it all, you know, IPOs, we've really seen it all. Um, and so if there's not an undergirding relentless investment philosophy that the advisor's willing to lose a client over, I would not use that advisor. You know, I'd be I'd be very cautious of that person because I want to know exactly how they feel. Look, the prospective client may not even agree with the with the advisor philosophy. That happens with us. I'll meet with a new potential client. Um, we'll discuss investment philosophy. Usually it's me bringing it up. And um, you know, every now and then, for the most part, people don't really have their own. And so they enjoy being educated and learning, and it's great. Every now and then I have somebody that just cannot stop the gambling and the speculating and the and the this time is different. And we are not a fit for that person. I would love to work with them, I'd love to work with everybody, but I am willing to lose that person because I do not want to co-sign at what I think is a negative or or something that can really injure them in terms of building their balance sheet. So, what is your investment philosophy? Simple question. Um, here's a really, really good one. I mean, heck, these are all good because I wrote them, right? I'm not objective. Um, how do you build income for retirement? And when do you do it? This is kind of the this is new to me. I maybe I just wasn't paying attention before, but what I what I mean by being new to me, look, I think people should, I don't care how old you are. If you're 35 and you're thinking about retirement, like I we should talk about that. Let's obviously we can't predict the next 20 or 30 years, but we can we can model it out and have an idea of where you're headed directionally. It's like jumping on an airplane, say I'm gonna fly to San Diego from St. Louis, and I'm like, I have no roadmap. That would be insane, right? You get on an airplane, you start flying to San Diego, you're gonna make little micro adjustments along the way, obviously. You know, the wind changes and weather changes and whatever. Um, so to have no idea where you're headed, even when you're really young, that doesn't make a lot of sense to me. But this is what's bizarre and what's new to me. I have a lot of new clients that have come to us, let's just say in the past, I don't know, three years or so. And they're they're like my age, that they're in their 50s, and their biggest complaint is that their advisor just kept saying to them, like, well, you'll be fine. You know, when they would ask about retirement income planning, you'll be fine. That is not going to remove worry from people. And that's our job, is to remove the worry for you. So, you know, you need to ask your advisor, like, when are we gonna build this income map? When are we gonna look at an income policy statement, is what I call it. When are we gonna do that? You should be doing that now. Um, and it shouldn't just be a real simple kind of Monte Carlo, just one calculator kind of a thing. No, it needs to be a literal roadmap. What are we gonna take? When are we gonna take it? In what order? You know, what are the different tax buckets at play there? Uh, what about if I, you know, if I pass away, how does that work with my spouse? What about Social Security maximization? I mean, there's a litany of stuff there. Um, so I would ask your advisor, when are we doing that? And what was that gonna look like? Give me an example, show me, show me a sample, right? It doesn't need to be a real client's data, but give me an idea. Um on in that same vein of retirement income, how about, hey, Mr. Advisor, when are you retiring? Like that's an important question. Um, I'm I'm thinking about it more and more. Obviously, I'm 51 years old. I mean, I'm not gonna, I listen, I've got six kids. A lot of you know that. Our youngest is five. I'm not retiring anytime soon. Um, but if you've got an advisor, just like I was kind of picking on the younger advisors before, you know, how long have you done this? Well, listen, it's fair to ask a, we'll just say more veteran advisor rather than an older advisor. Um, when are you retiring? Like, are you gonna sell this business? What's gonna happen to me if I trust you to build my income planning? And then, you know, and I retire, say five or six years down the road, but you retire before me or or soon thereafter, like, well, who's gonna manage this for me? Um, those are important questions. This is not just, hey, build me a portfolio and hope for the best, right? Um, help me with my legal documents, sell me some insurance, work on my mortgage, and then hope for the best. You're really, at least from our perspective, you're signing up for for some of you, for a lot of you, a lifelong commitment, right? I mean, we're gonna walk you right up to the exit of a business or right up until you're leaving uh the workforce and retiring, and then through that. And so it if you've got an older advisor, look, they're not gonna work forever. I understand that. Who's waiting in the wings? All right, how long have you mentored those people? What is their investment philosophy? What would that look like? Get to know them now. That's important. I mean, that's that's if it were me, critically important. Um, what are your non-negotiables? We did a whole podcast on this. You can go back, it's probably, I don't know, three or four pods ago. Uh, what are you willing to lose a client over? I can I can tell you that straight as an arrow. I mean, it's not that difficult for me. We will not speculate and gamble with your money. We will not co-sign you doing the same. So if you don't want to work with us because of that, I don't want to lose you, but we're gonna lose you. I'm not going to have people lose 50% of their money or have the potential to because of speculating and gambling with their money. Go to Vegas for that stuff. We don't do it in portfolios. Um, you know, look, I'll lose a client over just not insuring their life uh or buying their right amount of uh, you know, umbrella policy. I'm not a licensed property and casualty agent. Um, but I can look at somebody making a half a million dollars a year that has no liability coverage, and I can tell them to go to their property and casualty agent and fix it. And if they just say, no, I'm not gonna do that, like we're not gonna work with somebody like that. Not because we don't like them, not because they disagree with us, because just like my doctor, if my doctor is telling me, hey, you really need to do this or exercise that way, or you know, your dentist is telling you, hey, floss, and you just say no, well, what's the point? Why go to the dentist? Um, just to fix all the problems. Like we don't want to do that. We want to build something for you so that your family has all those hopes and dreams and desires and legacies. And it's an amazing thing we can build together, but I am definitely willing to lose clients over just really, really, you know, contrarian behavior and philosophies. And so your advisors should know what those things are. Here's a great one. How long has your support staff been with you? Uh, you know, look, I'm happy to report Sarah Apple, who a lot of you know, all of you know, really, if you've been with us any period of time, I think she just started her 15th year with us. Um, and uh, and that's important, right? I mean, keeping staff with you for long, long periods of time is as important, I think, as the advisor being around. Because, you know, that staff support person, while you may not interact with them all the time, and obviously they're not going to build your income statements and, you know, your investment portfolios and taxes and legal documents and insurances, I get it. But they're the ones that are doing the incredibly critical job of handling the paperwork, making sure that the custodian's paperwork matches the investment management paperwork and you know, making sure insurance policies get underwritten the correct way and that the documents are signed the correct way. I mean, they're critically important. We don't want a lot of turnover there, right? I understand that we don't keep employees forever. If you're a business owner listening to this, you're rolling your eyes going, man, I wish I could keep somebody that long. I I understand. Um, and there's always going to be staff turnover. But, you know, the direct support staff should should not be somebody that's every six months, a year, or something like that. Uh, just just something to kind of keep in mind. How long has your support staff been with you? And how old are they? You know, what's what's their plan? In that vein, what happens if you die, become disabled, or leave the business? I mean, look, you know, I could die tomorrow. Um, you know, we we had a client pass away from a heart attack recently. A healthy guy my age died in his sleep. It happens. Uh, it could happen to me. I could become disabled. Um, you know, I could sell the business. So what's the what's the plan around that? You're my client. I build those plans for you. If you die, become disabled when you retire. Like I'm building those for you. I have those too, right? So I have advisors waiting in the wings. If something were to happen to me, I know exactly who they are. I know how long they've been in business, I know their philosophies, they all match up. They all, you know, it's it's it would just be like working with Joe with a different personality. Um, so that's a question you want to ask people. What are the contingency plans here? Right? Who else is around? Kind of a longer podcast, but it's been on my mind recently. Um, as we have a lot of people retiring, we've gotten a lot of new clients. And so I want people to understand the heart we have, again, is to remove the worry for you, whether it's an investing or insurance or income planning or tax plan, whatever it might be. Um, and the only way that we can do that is if we have a an in-depth knowledge of who we are. You know, we're all taught on our side to know your client. That is true, but we need to know us. How do how do we operate? What are our philosophies? Who how do we treat our employees? You know, what's the business here? What's the continuation plan? These are all things you should know too. Um, so thanks for listening again. Check out the video. We've got Apple video, it's right there on your phone. Just click it. You can get the video of this, which is kind of newer for Apple. Obviously, uh video on Spotify, video on YouTube. Um, and we'll talk to you guys soon.

SPEAKER_01 16:20

Joseph Delisi is a registered representative and financial advisor of Park Avenue Securities, LLC, OSJ 5280, Carol Canyon Road, 300 San Diego, California, 92121-619-648-6400. Securities products and advisory services offered through PAS. Member FENRE, SIPC, financial representative of the Guardian Life Insurance Company of America, Guardian, New York, New York. PAS is a wholly owned subsidiary of Guardian. Westpac Wealth Partners LLC is not an affiliate or subsidiary of PAS or Guardian. Insurance products offered through Westpac Wealth Partners and Insurance Services LLC, a DBA of Westpac Wealth Partners LLC. CA Insurance License No. 0D34103. This podcast is for informational purposes only and is not to be construed as tax, legal, or investment advice. Although the information has been gathered from sources believed to be reliable, please note that individual situations can vary. Therefore, the information should be relied upon only when coordinated with individual professional advice. Guardian, its subsidiaries, agents, and employees do not provide tax, legal, or accounting advice. Guardian and its subsidiaries do not issue or advice with regard to mortgages, property and casualty insurance, and or car insurance. Consult your tax, legal, or accounting professional regarding your individual situation. All investments and investment strategies contain risk and may lose value. Diversification does not guarantee profit or protect against market loss. Equities may decline in value due to both real and perceived general market, economic, and industry conditions. Investing in securities of smaller companies tends to be more volatile and less liquid than securities of largest companies. Investing in the bond market is subject to certain risks, including market interest rate, issuer, credit, and inflation risk. This material is intended for general use. By providing this content, Park Avenue Securities LLC and your financial representative are not undertaking to provide investment advice or make a recommendation for a specific individual or situation, or to otherwise act in a fiduciary capacity. Past performance is not a guarantee of future results. Indices are unmanaged and one cannot invest directly in an index.