Wealth Advice: What Are You Getting Out of It?

Nearly four in 10 (38%) of Americans currently work with a financial advisor, representing a significant jump from __ pre-pandemic levels of 29%.¹ If you work with one, have you thought about how to measure the value you receive for the fee you pay?

In this Q&A, we’ll give you tips for what you should expect from your wealth advisor. No matter what, communication is key, so if you’re not sure how your fee is being put to work, ask your wealth advisor and expect a transparent answer.

Q: Does Working With an Advisor Help My Portfolio’s Rate of Return?

A: It can. According to Fidelity, industry studies estimate that financial advice can add between 1.5% and 4% to account growth over extended periods.²

Q: What Types of Services Should I Expect to Receive?

A: Most wealth advisors offer more than just investment oversight. For example, at Mariner Wealth Advisors, your advisor works closely with our in-house teams that offer individuals and businesses advice, including tax planning and preparation, estate planning, specialized business services, institutional cash management, retirement plan solutions, trust services, wealth planning, personal insurance solutions and investments. The goal is to create one, coordinated wealth plan for you that accounts for every aspect of your financial life.

Q: Can You Give Me Specific Examples of Services for High-Net-Worth Investors?

A: A wealth team offering comprehensive wealth management services can help you with:

• Goal-based financial strategies involving retirement planning and creating sustainable income
• Income tax planning and tax preparation
• Evaluation of the existing insurance policies and the creation of advanced insurance strategies to protect your assets and loved ones
• Customized investment solutions, such as an ESG (environmental, social and governance) portfolio that reflects your values. Recommendation of alternative investments, such as options, along with core equity and bond investments.
• Design of advanced estate planning and gifting strategies, such as SLATs (spousal lifetime access trust), grantor trusts, and other trusts to control how your assets are distributed and to whom
• Philanthropic advice, which may include charitable trusts or establishing a personal foundation or donor-advised fund for charitable giving
• Providing executive compensation analysis for corporate executives
• Helping business owners maximize the value of the business, prepare for sale and minimize taxes prior to the liquidity event

These are just a few examples of wealth planning strategies designed to help you achieve your short- and long-term goals.

Q: Can I Expect My Wealth Advisor to Check In Periodically?

A: Yes, that is a reasonable expectation. When you initially meet with your wealth advisor or even well into the relationship, you should discuss how often to meet. Once a quarter? Twice a year? Annually? The frequency should be what works for you and, as you near retirement, it may be beneficial to meet more than once a year.

Q: What Are Some Overall Benefits of Meeting With an Advisor?

A: By periodically reviewing your wealth plan with your advisor, including a portfolio review and assessing progress toward saving enough to last your lifetime, you’ll likely have greater peace of mind about whether you’re on track to retire comfortably and leave a legacy for your heirs and favorite charities.

And, if you have a life change, such as divorce, marriage or the death of a spouse, your wealth advisor can help you adjust your financial plan, including making changes in beneficiaries, insurance coverage and tax filing status, as well as helping you navigate tax law changes to help minimize your tax burden.  

Q: Is Measuring an Advisor’s Value Subjective?

A: Yes, while certain tax planning strategies can provide a quantifiable benefit, there are many more subjective benefits. One aspect of working with an advisor that’s hard to quantify is the overall guidance they offer when encouraging you to stick with your long-term plan, versus reacting emotionally when the market faces a correction. Time out of the market or making changes amidst a correction could significantly impact your portfolio’s value over time. Your advisor can work with you to determine when rebalancing your portfolio makes the most sense.

Consult With Your Wealth Team

At Mariner Wealth Advisors, your advisor follows our client-first mission, meaning they will listen first, understand your situation and help you determine your priorities, all to help you reach your short- and long-term goals.

Sources:

¹2021 Northwestern Mutual Planning & Progress Study

²Value of advice sources: Envestnet, Capital Sigma, The Advisor Advantage (PDF)Opens in a new window estimates advisor value add at an average of 3% per year), 2019; Russell Investments 2019 Value of a Financial Advisor Update Opens in a new window estimates value add at more than 4% per year); and Vanguard, Putting a Value on Your Value: Quantifying Vanguard Advisor’s Alpha® 2019, (estimates lifetime value add at an average of 3%). The methodologies for these studies vary greatly. In the Envestnet and Russell studies, the paper sought to identify the absolute value of a set of services, while the Vanguard study compared expected impact of advisor practices to a hypothetical base case scenario. Please follow the links above to see important differences in the methodologies of these various studies.

The information contained herein is not intended to be personal legal, investment or tax advice or a solicitation to buy or sell any security or engage in a particular investment strategy. Nothing herein should be relied upon as such. The information contained herein is current as of 2022 and has been obtained from sources believed to be reliable, but Mariner Wealth Advisors does not warrant the accuracy of the information. The views expressed are for commentary purposes only and do not take into account any individual personal, financial, or tax considerations. There is no guarantee that any claims made will come to pass. Consult a financial, tax or legal professional for specific information related to your own situation.

Some services listed in this piece are provided by affiliates of MWA and are subject to additional fees. Additional fees may also apply for tax planning and preparation services. The tax laws discussed are proposed at the time and any final laws or regulations passed may vary significantly from the proposed. Tax laws and regulations are complex and subject to change, and we cannot guarantee that the information herein is accurate, complete, or timely. Any changes to the proposed may also affect any illustrations used in this article.

Mariner Wealth Advisors (“MWA”), is an SEC registered investment adviser with its principal place of business in the State of Kansas. Registration of an investment adviser does not imply a certain level of skill or training. MWA is in compliance with the current notice filing requirements imposed upon registered investment advisers by those states in which MWA maintains clients. MWA may only transact business in those states in which it is notice filed or qualifies for an exemption or exclusion from notice filing requirements. Any subsequent, direct communication by MWA with a prospective client shall be conducted by a representative that is either registered or qualifies for an exemption or exclusion from registration in the state where the prospective client resides. For additional information about MWA, including fees and services, please contact MWA or refer to the Investment Adviser Public Disclosure website. Please read the disclosure statement carefully before you invest or send money.