Did you hire your advisor because he or she is likable? Then you are in the majority.
Did you hire your financial advisor because you liked him or her, you asked all the right questions and he or she gave you the answers you wanted? Not likely.
New research shows people hire their advisors based on likeability not on ability or skill set. Michael Lovas, the founder of a coaching firm serving the financial industry, tells financial advisors that to get more business, they should focus on being more ‘likeable.’
This does not bode well for individuals, as it suggests they are not asking the right questions and focusing on what may be more important–specifically how the advisor will help achieve your goals.
From my modest survey of colleagues, friends and associates, they chose likeability as the key to choosing an advisor as well as many other professionals. Due to the technical nature of our work, many people don’t know the right questions to ask when interviewing a specialist, whether the candidate is in financial services or any other profession.
I suggest you take a look at my blog on “Seven Ways to Tell if Your Advisor Is Doing a Good Job for You.” Although these are not questions to ask when interviewing, they will help you understand whether you made the right decision in hiring the advisor you have now.
Likeability is certainly an important factor in your decision to hire an advisor, but his or her skill set, knowledge and how their company is structured are also essential to your financial future.
You can also search online for a list of questions to ask prospective advisors. Choose the ones that apply to your situation, and come prepared when you meet with candidates. It might seem like a chore initially, but doing the due diligence in advance will save you the pain of changing advisors later on.
Disclaimer: The views expressed in this article are the opinions of the author and should not be interpreted as individualized investment advice. Investment objectives, risk tolerances and the financial situation of individual investors may vary. Please consult your financial and tax advisers before investing.