How Much Will the Financial Advisor Explain About My Financial Investments?

Many people are hesitant to enlist the services of a financial advisor simply because of uncertainty about the nature of the relationship the two would have to one another. Some clients hope and expect their finance pro to tell them every last detail about decisions they make and investments they choose. But others take the opposite approach, figuring that haggling over the details is exactly what they are paying this professional to do. Of course, these are only two extremes, and many investors fall somewhere in between.

Advisor/Client Relationship is Flexible

Some would be investors stay away from this type of business relationship because they fear either too little or too much control on the part of the financial advisor. But the truth of the matter is that this relationship is totally flexible. There is no limit to the amount of input and even control that the investor can have over any and all investment purchases made. After all, it is your investment capital that's at stake. It is your money at risk, and all advisors know and understand this. If you have a strong desire to know exactly what is going on and to be kept up to speed at all time, then you can get all the information you need. It will likely cost you some money to take this extra time, but it may be worth it to those of us who have that innate need to know.

On the other hand, some investors prefer to allow the experts leeway to do their thing, and they just stay out of the way unless they are needed to sign paperwork or to give permission to invest in certain areas of the market. For this group, the ideal financial advisor is headstrong and independent, only checking in every once in a while to report on results and not necessarily the details. Investors who fall into this category tend to be more interested in the product rather than the process. They do their homework ahead of time and pick their advisors based on reputation and track record, allowing the results to speak for themselves.

Most Investors are Between Extremes

Of course, most investors fall somewhere in between these two extremes. They may not need to know all the terminology, but they do not mind hearing an explanation for why certain investments were chosen over others. They do not pore over every account statement that comes in the mail, but they don't use the back of it to create shopping lists or leave notes for the kids, either. They understand that their financial advisor has a job to do and needs a certain amount of autonomy to do it; yet they also value accountability, and they appreciate being in the loop when their investments underperform or when advisors choose a new tack with their investments.

Advisors Abide by Client Expectations

Generally, a financial advisor will abide by and honor your expectations as long as they are reasonable. If you are upfront about your need to have everything explained to you and to feel like you are involved in every step of the process, he will certainly honor that need. Some advisors may even be equally honest and let you know that they would prefer not to work under those conditions. For this reason, it is always best to give your financial professional a realistic preview of what to expect in your working relationship right from the get go. They're usually happy to work with you and try to meet your needs.

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