The 7 Biggest Mistakes to Avoid When Working with Your Wealth Manager

Aug 3, 2020 | Insights

By Jennifer L. King
Chief Executive Officer, Corporate Secretary & Director, and Chief Compliance Officer

You’ve taken the plunge—you’ve decided to hire a wealth manager to help you preserve and grow your assets. As you search for the best fit, it’s important to avoid mistakes that could cost you now and in the future.

To that end, transparency and honesty are two of the three most important factors in the adviser-client relationship. Yes, of course, you want a wealth manager/adviser who is transparent and honest. It’s also your responsibility to be as clear and straightforward with your adviser as possible. If you’re less than honest, your adviser can’t help you to the best of their ability.

Another important factor is understanding your goals in entering into a partnership with an adviser. In other words, why do you want to hire an adviser? Clarifying your goals will help you get off to the best possible start with your new adviser. After all, hiring an adviser to help you plan your retirement is a very different goal than hiring an adviser to help you put your four kids through college debt free.

The other critical factor in hiring a wealth manager is understanding the different types of advisers and how they help. Independent financial advisers, also known as wealth managers, have a fiduciary duty to their clients—an obligation to act in their clients’ best interest. Brokerage firm financial advisers, also known as brokers, may operate under a lower standard.

With this in mind, here are seven mistakes to avoid when hiring a wealth manager.

Mistake #1: Hiring the Wrong Wealth Manager

Before you hire an adviser, it’s important to do some basic homework. Check out that adviser’s website and LinkedIn profile to get a sense for the type of clients they work with and the statements they make. Go to to find out whether complaints have been filed against the adviser, as well as their licenses, educational background and employment history.

When you interview a wealth manager—either by phone, video or in person—gather information about his or her strategies and get a feel for their communication style. Their investment strategies should align with your goals. For example, if you’re interested in preserving your wealth, you don’t want an adviser who seems to have only an aggressive investment style.

Mistake #2: Ignoring Your Wealth Manager’s Recommendations

You hire a manager for advice., don’t ignore it.

While you’re still working, your manager may counsel you to save more money for retirement.

Your adviser may also suggest you rein in spending or limits gifts to children or grandchildren.

Mistake #3: Micro-managing Your Wealth Manager

The major task of a wealth manager is to manage your investments for you. Before you hire an adviser, ask yourself if you are truly ready to give up control. If you’re not, you may not be ready to hire an adviser.

Micro-managing your adviser may lead to them compromising on their strategy to placate you, which won’t help you meet your investment goals.

Mistake #4: Keeping Your Full Financial Situation a Secret

Many investors don’t give their advisers a complete and clear picture of their finances.

This can hurt you. A manager can’t manage your money appropriately if he or she doesn’t know the extent and make up of all your investments.

And it’s just as important to discuss upcoming financial needs such as a deposit for an assisted living facility or significant educational expenses.

Mistake #5: Ignoring Aspects of Your Finances

Financial planning involves not only investing, but tax planning, estate planning, insurance and debt management. Ignoring those elements of your finances can undermine your entire plan.

For instance, you may have a strong financial plan leading up to your retirement. But if you have substantial credit card debt at the same time, that debt may sabotage your retirement.

Mistake #6: Having Unrealistic Financial Goals

Having realistic goals is an important part of a successful financial plan. It’s important to know how much you can safely spend; how much debt you can safely manage; how much you need to save for retirement; and to recognize healthcare spending in retirement may be significant.

Mistake #7: Underestimating Your Life Expectancy

Americans are living longer than ever—especially affluent Americans. Research reveals most of us are likely to live into the 80s or 90s, or longer. Plan for it.

Longevity brings many rewards, including extended time with family and the chance to build relationships with your grandchildren and great-grandchildren. But it also brings higher healthcare expenses. In fact, Fidelity Investments estimates that the average 65-year-old couple retiring in 2019 will spend $285,000 in retirement on healthcare expenses, excluding long-term care.

This is why it’s important to save as much as you can for retirement while you’re still working and avoid overspending beyond your income when you’re in retirement.

A Final Word

Avoiding mistakes like these will give you a better chance of a successful financial future. If you’re interested in getting a second opinion about your investments and current financial plan, call for a free consultation with Chase Investment Counsel today.

About Chase Investment Counsel

Chase Investment Counsel is a family and employee-owned boutique wealth management firm that offers personalized investment services. Our clients include career professionals, those nearing or in retirement, and families experiencing financial transitions such as generational wealth transfer, widowhood, divorce or sale of a business. Chase’s active, disciplined investment management team is focused on selecting individual stocks and bonds targeted to each investor’s specific financial goals and risk tolerance. Established in 1957 in Charlottesville, VA, Chase Investment Counsel manages approximately $300 million in assets.

About Jennifer L. King, IACCP®

Jennifer King is Chief Executive Officer, Corporate Secretary & Director, and Chief Compliance Officer of Chase Investment Counsel. Jennifer earned a BS in commerce from the University of Virginia in 1992 and an MBA from James Madison University in 1997. She is an NRS Investment Adviser Certified Compliance Professional® and is responsible for the firm’s compliance program. In addition, she handles operations and administration for the firm, including supervising performance measurement, client investment record keeping and reporting. She also manages client relations related to those functions and supervises the maintenance of our performance measurement software. Jennifer is a past president of the Rotary Club of Charlottesville and a Director of The Center, a local non-profit providing opportunities for healthy aging in the community. Contact: 434-293-9104 x103 or [email protected]