Pay no attention to that man behind the curtain.

At some point in our lives we all attend a corporate event related to our business/career/life. Typically, I do not willingly participate in group bonding, or group activities with people in my industry (or really anyone). Last month, I made an exception and attended a regional meeting for a group of advisors I am associated with through my asset management services. As I listened to the presenters, planning ideas, and industry updates I wondered what the consumer would think about our discussions. To give you a peak behind the industry curtain, I made a list of takeaways for the consumer about my industry and our prescribed solutions.

Takeaway 1: There is no industry standard for evaluating your advisor/financial planner and their recommendations.

What does this mean for the consumer? Well, if there is no standard to evaluate the quality of advice from your financial planner, the consumer must determine what makes the most sense for them. This may be overwhelming to consumers outside of the system, who may not have the tools to evaluate an industry with so many variables.

Note, advisors like myself are fiduciaries; required to put clients’ interests ahead of our own. Those who are not fiduciaries are bound by the suitability rule, requiring that any recommendations be in the best interest of the customer. The industry regulations prescribing suitable or fiduciary conduct deal with the underlying motivations of advice, but do not provide a framework or standard for assessing success when working with an individual advisor.

Documenting my theories on what the industry standardized approach should look like would take longer than a paragraph in a blog (maybe I’ll write a book on it). For today’s purposes, I highly encourage you to ask, at minimum, these three things when evaluating a financial services professional:

  1. Is this person an expert?

At minimum, make sure they have a professional designation (CFP), educational background, or ample experience in the realm they are advising you on. This shows both knowledge and dedication to their field (a field with high turnover).

      2. Do I like and trust this person?

It surprises me how many clients I work with who, in the past, did not even like “their guy”. If you do not like your financial planner, as in, would not have them over for dinner or get a drink with them, do not work with them.

       3. Is our relationship aligned?

A relationship with a professional expert should not be a zero sum game. An advisor’s goals, compensation, and motivation should be complimentary to yours.

Takeaway 2: Financial planning strategies are diverse and your solution may vary depending on the expert you are working with.

To achieve your objectives there are multiple paths to success and our industry has multiple solutions for every problem.

Generally, I view our industry as having three distinct types of advisors; advisors who employ financial products (insurance, annuities, REITs, etc), advisors who only manage money, and advisors (like me) who provide fee for service advice and utilize mutual funds, stocks, and bonds to achieve investment goals. Depending on your needs, we all have a strategy to sell you. The difficulty is finding an expert advisor you like with a straightforward strategy for your situation.

My business model is to discuss strategy before any products or investments are contemplated. When I say strategy, I mean take into account your entire financial picture including your goals, timeline, risk tolerance, and other variables affecting the outcome of your financial plan. Even if you are only engaging someone for a portion of your plan (for instance, managing a particular investment), they need to understand your entire financial picture to determine how one strategy compliments your overarching financial goals.

I believe the underlying strategy is the foundation to success and the tactics to obtain victory can vary. So I urge you, evaluate as best you can and research the person you are working with. If they are not proposing an approach based on a holistic strategy of your entire financial plan, do not work with them.

Takeaway 3: With all this noise, the consumer should focus solely on his objective and understanding the strategy to achieve it.

Focus on your objective and tune out the rest of the noise. Can you simply state your goal: “save more”, “create retirement income,” “invest better”. Once you define your goal, work with someone who applies a strategy you understand to accomplish the goal.

As I listened to these wholesalers (a group of salesmen hired to sell to another group of salesmen)tell me how complex and genius some of these products or fund managers were, I realized just how important keeping it simple is to the consumer. Don’t fall for bells and whistles, they are sideshows designed to distract you from the man behind the curtain. If someone promises you something that is too good to be true, it is. Ask yourself, if it’s so great, why isn’t this person recommending it on a private island right now?

Along with proposing the strategy, it is your financial planner’s job to effectively communicate and make sure you understand how their solution moves your plan forward.


Rest assured, consumers are not the only ones perplexed by my industry. The concepts presented to us were nebulous, confusing, and, at times, downright bizarre. It felt like some of the “solutions” presented had some back story I was not privy to. Like there was a man moving these levers and knobs behind the scenes, and I was just there to sell the product or solution.

If I feel this way, I can only imagine how the consumer, not familiar with my industry feels. My impression is many consumers begrudgingly use our products and services without understanding why. Fortunately, with the internet, clients now have endless tools to research and better understand our field. For now, when everything else fails, trust your gut and ask around. If you understand your objective, the solution is not ambiguous or murky, and the strategy is straightforward, you are probably on the right track. And never hesitate to get a second opinion.

Author: Jenny ErdmannJenny is owner of Chisholm Financial Planning & Investments. She loves discipline, freedom, America, and financial planning. When not working with clients, she can be found enjoying sunshine and freedom with Lucy, the best dog in the world and Chisholm's mascot.

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