Let's face it: relationships don't always work out. This is as true with financial advisers as it is with hair stylists, physicians, and high school romances. But what should you do when things aren't working out well with your financial adviser? Is there a way to break up with your financial adviser and "still be friends"? There is. You can relax because financial advisers are professionals who know that they're not the right fit for every person. Still, breakups can be tough. Your finances are personal, and there might be things your financial adviser knows about you that no one else does. You also may have developed a friendship over the years, and if your financial adviser is a neighbor or family member, the breakup may feel especially awkward. To help ease the pain, we've put together some tips to help you get out of a non-productive relationship with your current financial adviser so you can move on to an adviser who will help you to grow. Understanding why you need a new financial adviser not only helps you to explain why you're breaking up, but it also helps you to have the confidence to make the move. Here are some examples ofdifferentiatorsthat may apply to your situation: Once you know and understand the specific reasons you want to move to a different financial adviser, you'll be able to explain it to others, and you'll have more confidence in your decision. When you break the news to your financial adviser, keep it brief and professional. Thank your adviser for his or her help in the past, and explain that things have changed and you're moving on. If you want to share the specific reasons that explain your move, go ahead and do it. But don't feel obligated to explain. It's your money and your decision. You can keep your reasoning to yourself if you want to. That said, your financial adviser may not want to let you go easily. Losing your business doesn't just hurt your adviser's pride; the loss will also hurt his bottom line. So it's more than reasonable for him to try and keep your business. Be polite and respectful. Hear your financial adviser out. But if you've firmly made up your mind, just explain that you really do appreciate the work they’ve done for you in the past, but your mind is made up: it's time for you to go now. If this sounds all too confrontational, perhaps a phone call alerting your adviser of your decision is enough. This might not work so well if you have a long-established personal friendship. In fact, such a move could mark the end of a long-established personal friendship, but if your relationship with your financial adviser is formal and strictly business, there's nothing wrong with the “phone call” version of a break-up. Yes, breaking up can be hard to do, but sometimes it's necessary for you to spread your wings and take your finances in a healthier, more profitable direction.1. Find the Differentiator
2. Keep It Professional
3. Be Prepared for Pushback
4. Slip Away If You Must
FAQs
How To Break Up With Your Financial Adviser? ›
Contact your advisor, thank them for their service, and ask for transfer-out paperwork- I understand you may not want to talk to the advisor you are leaving. Breaking-up isn't exactly fun. In my opinion, letting your advisor know you are leaving them is the right thing to do. A call will do.
How do you end a relationship with a financial advisor? ›You can either call or email your advisor - but letting them know you're leaving and why is a nice thing to do. Your new advisor will actually do all the work of transitioning the accounts for you. A simple email like this would work great...
When should you leave your financial advisor? ›Poor performance, high fees, strained communication and stagnant advice are among the reasons to look for a new advisor. Kevin Voigt is a former staff writer for NerdWallet covering investing.
What to do if you are unhappy with your financial advisor? ›You need to contact the financial business you want to complain about first, and give them a chance to resolve things, before submitting your complaint to us. You need to tell them what's happened and how you want the problem put right.
How do I politely fire your financial advisor? ›I want to thank you and express my appreciation for all your help over the past few years with my personal finances. At this time, I've decided to move my accounts to another advisor that I feel is a better fit for me as of (end-date).
How do you separate from your financial advisor? ›In most cases, you simply have to send a signed letter to your advisor to terminate the contract. In some instances, you may have to pay a termination fee.
What do you say when leaving a financial advisor? ›Be polite and respectful. Hear your financial adviser out. But if you've firmly made up your mind, just explain that you really do appreciate the work they've done for you in the past, but your mind is made up: it's time for you to go now.
How do I know if my financial advisor is bad? ›- They're unresponsive. ...
- They don't check in with you. ...
- They're inattentive. ...
- They have high fees. ...
- They push you toward certain investments. ...
- You're unhappy with your portfolio's performance. ...
- They don't have a good relationship with you. ...
- Bottom line.
- "I offer a guaranteed rate of return."
- "Performance is the only thing that matters."
- "This investment product is risk-free. ...
- "Don't worry about how you're invested. ...
- "I know my pay structure is confusing; just trust me that it's fair."
- Consulting with a “captive” advisor instead of an independent advisor. ...
- Hiring an individual instead of a team. ...
- Choosing an advisor who focuses on just one area of planning. ...
- Not understanding how an advisor is paid. ...
- Failing to get referrals.
How often do people switch financial advisors? ›
People often switch financial advisors when they experience significant life changes or feel their current advisor is no longer suitable, but there is no set frequency for making such a change.
How do you end a contract with a financial advisor? ›- Let them know in writing, and keep a copy for your records.
- Cancel any authorities you've given them, for example, transaction authorities or access to bank accounts.
- Review the advice you've received from them. ...
- Cancel the fees (or reallocate them to your new adviser).
There are lots of legitimate reasons to break up with your financial advisor. You may not like his fee structure, your philosophies may be misaligned, you may want to do business with a firm that offers different services or perhaps you want to take a more do-it-yourself approach to your finances.
How do I protect myself from a financial advisor? ›- Make sure they are a Certified Financial Planner (CFP). ...
- Make sure your advisors or their firms (and your investments) are registered with the SEC.
- Check their past for SEC rule violations.
- Read Your Client Agreement. Once you decide to divorce your financial advisor, you should review the agreement that you likely signed with the advisor. ...
- Decide Your Next Move. ...
- Get Your Records. ...
- End the Relationship.
Give them a heads-up: Let them know that you have been thinking about this and that you have decided it's time to move on. Be honest: Don't make up excuses or try to sugarcoat things. Be tactful when explaining your perspective. Be respectful: Keep your tone polite, and avoid being overly critical.
Why do people leave their financial advisor? ›Underwhelming performance is a common reason clients leave financial advisors. Your client may expect a certain rate of return, for example, and be disappointed when you're not able to produce it.
How do you end a relationship with a consultant? ›Offer solid reasons and ask for your client's participation in a conversation that's honest and factual, not emotional. Next, listen to what they have to say. You can learn a lot, and they deserve to be heard. Last, offer up a reasonable separation date so they are not left in a bad place in terms of the work.