I do many of these things and keep wondering how to charge for it…However if you do have a FA he should do the following for you:
1. Do not choose that instrument: He should have the guts and knowledge to say what kind of financial instruments YOU as the client should not touch. This is really difficult because a fellow adviser may be pushing real hard.
2. The real big ones should soon be able to tweak the fund houses to do more tailor made portfolios with much LOWER asset management charges. Of course the bigger and more arrogant funds will NOT do this, but the smaller fund houses may offer it to the FA. Any drop from the legal 2.5% is surely welcome. Not a cent has dropped so far!
3. Keeping track of goals vs asset allocation: Shifting you from more volatile asset classes to less volatile asset classes as you get closer to your goals, IMMATERIAL of what you think or say. Clients will want to stay on in WELL PERFORMING asset classes TILL the day they need money!
4. Making you stay the whole course as DECIDED on the day of making the investment: People say ‘I am investing for 10 years’ but start worrying from the 10th day of making the investment. To explain to you why you made that investment, encouraging you to write it down, holding your hand and explaining that over a longer period, STANDARD DEVIATION does not matter….are all the jobs of a FA
5. Making sure that your spouse understands the whole process so that if your smart client and the more smart FA die she will at least know what to do – without asking!
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