Morgan Hill Today 2014 09 Fall | Page 49

FINANCIALLY

Speaking

Reaching Your Goals … The Advisor Advantage

by
Daniel T . Newquist , CFP ®, AIF ®
Daniel T . Newquist , CFP ®, AIF ® is a Principal Wealth Advisor with RNP Advisory Services , Inc ., in Morgan Hill with over 18 years experience advising clients on their personal wealth , retirement planning , insurance , and business planning needs . Born and raised in Morgan Hill , Dan is available for private consultations and speaking engagements . Investment advisory services offered through RNP Advisory Services , Inc . – a registered investment advisor . Securities offered through Foothill Securities , Inc ., member FINRA / SIPC , an unaffiliated company . Visit his website at www . RNPadvisory . com or call 408-779-0699 .

It ’ s Fall and that means football . As assistant coach on my son ’ s Pop Warner football team , it is always exciting to see the team come together . Each player knowing their job , perfecting their skill and executing as a team . With all of the hard work , it wouldn ’ t be much if it weren ’ t for the head coach aligning the team and bringing it all together .

Anytime you work with a coach , a mentor or advisor there are benefits . When working with a financial advisor you receive a number or powerful benefits . Some benefits , like investment reviews , rebalancing and ongoing monitoring of assets , can be quantified and benefits , like peace of mind , can be harder to quantify . When working with a fee-based financial advisor , you are aligned with a professional who is focused on you , your values and your success . The benefit this alignment brings cannot be understated .
A Fiduciary A fee-based financial advisor is a fiduciary . A fiduciary is someone who is legally obligated to look out for your best interests . Doctors and lawyers are held to this standard , so it makes sense to require this of the people handling your money . It ’ s important to understand that while a fee-based investment advisor is legally and ethically held to the fiduciary standard , stockbrokers and advisors that earn commissions are not . Commissionearning advisors are only held to a “ suitability ” standard , where they have to make sure an investment is appropriate for your age , risk tolerance and economic status .
On the other hand , Fiduciaries must not only make certain that an investment is suitable for you , they also have to make sure it is in your best interest . This legal obligation is enforced by the Securities and Exchange Commission and supported by a requirement that mandates full-disclosure of any conflicts of interest .
A Wealth Manager When you work with a fee-based advisor they get to know you by asking questions about your family , your occupations , your money , and your goals . All of this information is considered in the investment advice and recommendations they prepare for you . If your needs reach beyond the scope of what they provide , your advisor plays a key role in referring or coordinating with other specialized professionals like legal , tax , insurance , mortgage and real estate .
A Behavioral Coach Once your goals are established and a plan is implemented , it should be smooth sailing right ? Not necessarily . Sometimes your investments can be volatile , testing your investment convictions . It is during these times that you need to avoid over-reacting and doing something that you may later regret with your money . The same holds true when investments are performing exceptionally well and your expectations change to assume that the exceptional performance will continue .
Your advisor will keep you calm and focused on your goals by educating you on your investments and helping you keep a perspective on the big picture . Historically , markets have gone up over time , but rarely do so in a straight line .
A March 2014 study by The Vanguard Group 1 , showed that from behavioral coaching alone , it was estimated that the discipline and guidance advisors provide as a regulator of market news could add as much as 1.50 % annually to our long-term results .
The Advisor Advantage Fee-based advisors provide benefits beyond investment management . We look after your best interests , manage your entire situation and coach you in good and bad times . Like a football team , all of this combines to help increase the likelihood of achieving what is most important to you – your goals .
1
Putting a Value on Your Value : Quantifying Vanguard Advisor ’ s Alpha ” This article is intended for educational purposes only . It is not intended as investment advice . Always consult your financial or tax-planning professional for guidance with respect to your specific situation .
F A L L 2 0 1 4 M O R G A N H I L L T O D A Y
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