Author Topic: How do I get rid of my financial advisor...  (Read 13842 times)

FuckRx

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How do I get rid of my financial advisor...
« on: April 10, 2014, 04:18:31 PM »

This guy started out as a friend/acquaintance and with time he became my financial advisor. I started working with him at a time when I didn't even know what a bond or index fund is. He currently manages my 401k, IRA and some taxable money that's mostly in municipal bonds right now. He charges 1.5-5% for the sale of mutual funds in a company called Lord Abbett. My sales are made 2x per month. He currently manages somewhere around 100k of my money and I invest about 6k with him per month.

What's the best way to tell this guy that I don't want to work with him anymore. I've been working with him now for 8 months. I suppose I'm looking for tactful ways of doing it and a part of me still thinks "hey but this guy helped you get started investing, he gave you a lot of advice, what if you don't know how to do it better yourself using Vanguard and other platforms". Oh and the same guy was trying to sell me Whole Life Insurance.

BigRed

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Re: How do I get rid of my financial advisor...
« Reply #1 on: April 10, 2014, 04:25:08 PM »
Not sure exactly how much you've paid him, since you don't say how much you've sold or whether there are charges when buying, but I'm guessing you've paid him over $1,000 already, so you can probably not have so much guilt about moving on.  He's done fine, and he will continue to do fine without you.

FuckRx

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Re: How do I get rid of my financial advisor...
« Reply #2 on: April 10, 2014, 04:27:31 PM »
well he transferred like 60k from my 401k and rolled it over into that Lord Abbett aaccount so definitely more than 1k.

seattlecyclone

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Re: How do I get rid of my financial advisor...
« Reply #3 on: April 10, 2014, 04:33:24 PM »
Just tell him you're switching to another firm. Just remember he works for you. You have no duty to keep him happy if he's no longer working in your best interest.

MDM

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Re: How do I get rid of my financial advisor...
« Reply #4 on: April 10, 2014, 04:42:08 PM »
From one of the older advice columns (Ann Landers): "Nobody can take advantage of you without your permission".

No need to apologize, and no need to be insulting.  Just look him in the eye and say "Thanks, I've learned enough that I'm going to do this on my own now."

Good luck!

Eric

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Re: How do I get rid of my financial advisor...
« Reply #5 on: April 10, 2014, 04:48:26 PM »
You should just do it like a Band-Aid: one motion–right off!

/Seinfeld

Thegoblinchief

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Re: How do I get rid of my financial advisor...
« Reply #6 on: April 10, 2014, 07:18:15 PM »
You should just do it like a Band-Aid: one motion–right off!

/Seinfeld

+1

chasesfish

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Re: How do I get rid of my financial advisor...
« Reply #7 on: April 10, 2014, 07:39:10 PM »
Open an account at a discount brokerage and get it going (I prefer Fidelity, but Vanguard/TD/Scwab are all good).

Then tell him you've decided to be a do it yourself investor and file hone transfer paperwork with your new firm.

FuckRx

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Re: How do I get rid of my financial advisor...
« Reply #8 on: April 10, 2014, 07:55:12 PM »

thanks guys!
It's done, I was going to wait until I met with him in person but much like a significant other it's so much classier to do it over email :)
I basically said, thank you for your guidance and getting me started but I'm not ready to take it over myself and manage my own investments. Please help me complete my paperwork to transfer the money into my own investment accounts.

I'll start a separate thread to get some investment advice when I get all this done.

CarDude

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Re: How do I get rid of my financial advisor...
« Reply #9 on: April 10, 2014, 07:59:47 PM »
You should just do it like a Band-Aid: one motion–right off!

/Seinfeld

Hah. That's what I came to say.

ms

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Re: How do I get rid of my financial advisor...
« Reply #10 on: April 11, 2014, 07:16:29 AM »
I worked with my financial advisor for 15 years!  15 years!  Ugh.  She was introduced to me by a friend and then she became almost like friend.  But when I calculated how much in fees she was costing me, it's about $1000 a year and I only had about a 40k portfolio with her.  It was really hard to try and "break up" with her.

In the end, I opened an account with Questrade and I requested the transfer.  I also sent her a handwritten card in the mail thanking her for the years of advice and told her something like I'm consolidating my finances as I begin a new chapter, etc.  I just felt like I needed to soften the blow of losing my business.  I did put in there that I'm going to Vanguard ETFs so that she can clue in as to why I'm actually doing the transfer without having to tell her that 2.5% MER is not acceptable any more.

nereo

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Re: How do I get rid of my financial advisor...
« Reply #11 on: April 11, 2014, 07:46:43 AM »
Anyone else have Paul Simon's "50 ways to loose your lover" song playing in their head when they read this question?

stuckinmn

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Re: How do I get rid of my financial advisor...
« Reply #12 on: April 11, 2014, 07:56:45 AM »
Just fill out the form, Norm, lower your fees, Lee...

FuckRx

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Re: How do I get rid of my financial advisor...
« Reply #13 on: April 11, 2014, 08:21:34 AM »

oh he didn't like that email. seriously it's like breaking up with a significant other. he email me back "but why", that's it, that was the whole email. then he texted me too "i need to speak with you tonight, please call me" followed 1 hour later by "tonight isn't a good time to talk please call me tomorrow".
I'm gonna write "look, it's not you, it's me. i've changed and the things that used to make me happy no longer are no longer doing it for me. i feel like i need to move on because there is something else out there for me that's just better. the times we had were amazing, and i'm so glad i got to know you and i hope i never lose your friendship. but it's time for me to move on. i'm sorry if i've hurt you and i understand how you feel. in time you will get over this. there will be someone else more suited for you. please don't make this difficult, let's just move on with it."

PS: "please don't text me for booty calls"

Spork

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Re: How do I get rid of my financial advisor...
« Reply #14 on: April 11, 2014, 08:29:38 AM »
That's dumb on his part.

(I think you're a doc... so using that analogy.)  It's really common in the medical industry to get second opinions and to switch doctors for almost any reason.  And doctors (at least the docs I know personally) don't seem to think anything about it.  There is business and there is personal.  This is business.  If this guy can't separate the two, then he's likely to lose the personal side in the breakup.

rubybeth

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Re: How do I get rid of my financial advisor...
« Reply #15 on: April 11, 2014, 08:34:10 AM »
I wouldn't reply to the "but why?" e-mail. Like another poster said, you can say you're switching to Vanguard or whatever, and he can figure out the lower costs thing like a big boy.
« Last Edit: April 11, 2014, 09:14:50 AM by rubybeth »

FuckRx

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Re: How do I get rid of my financial advisor...
« Reply #16 on: April 11, 2014, 08:56:19 AM »

Agreed, i try to do my best for my patients. if they go and get a second opinion i welcome that and actually give props to the patient for caring enough about their health to even go and get a second opinion.

I've come to the somewhat sad conclusion that he befriended me in order to win my trust and then took a financial crap on my head. now that i'm done wiping all that off i realize the dude is a charlatan.

Villanelle

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Re: How do I get rid of my financial advisor...
« Reply #17 on: April 11, 2014, 09:06:44 AM »
"But why" is incredibly unprofessional and a[nother] sign that you made the right choice.

You don't owe this guy anything more than the fees you've already paid.  If you don't want to talk to him, don't.  Especially because he's made it clear he isn't going to go gracefully and he's going to use guilt and the hard sell. 

I'd email back and tell him that I've just decided to manage my own funds, and that I don't see the need for a phone call, but that I wish him well.  And then I'd just stop responding to anything.  That's more of an explanation than you own him, though I'd offer it as a way to try and make him accept that this is final. 

FuckRx

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Re: How do I get rid of my financial advisor...
« Reply #18 on: April 11, 2014, 09:12:17 AM »
thanks villanelle, that's what i've decided to do, i think it's the respectable thing on my part to do. i'm not trying to instigate him but that will be the last communication regarding that issue. anything after that will be about getting things out of his clutches and back in my control.

Frankies Girl

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Re: How do I get rid of my financial advisor...
« Reply #19 on: April 11, 2014, 10:35:11 AM »
I had a bad breakup with an adviser early this year. He'd been pressing me with really hard sell tactics to transfer more money to him since he was sure he could do so much better than whomever I had besides himself. I was polite pretty much all the way through, and kept telling him thanks, but I'm still figuring stuff out on my own, but I wasn't interested. I thought that would be pretty plain that if I wanted his input, I'd ask for it and he'd leave me alone otherwise, but he decided to keep "touching base" way more frequently than normal. So I told him that I was planning on self-managing, and he started telling me that that was a bad idea since he was a professional and expert and basically told me it was like he was a doctor and some random patient was deciding to operate on themselves - and got close to the line of calling me too dumb to invest... but I stayed polite and firm with him and told him (again) that I was not interested.

And then a day later, he transferred my account to the general pool of investors, which was fine technically, but it was the way he did it. No notice or alert, and it generated a new account number and all of my account details disappeared for about a week while they transferred everything. I'm sure it was a tantrum-like move since he realized that I wasn't going to be a cash cow for him.

I called the pool and told them that I was NOT happy, and that the adviser had been using hard-sell tactics, and based off of that, I was done with their company as a whole. I didn't get rude, but I made sure to tell them that he'd been pressuring me for months and it was not appreciated.

So if I was you, I'd ignore the guy - don't even email him back because that just forces you on the defensive and gives him another opportunity to try to talk you out of it.

Just call the main number for your new financial institution to complete the forms for transfer and do an end run around him. You gave him the courtesy of a heads-up, and that is really more than kind. I can't stand pushy jerks like that, and there's no reason you have to deal with him at all. Just fill out the forms for the place you're transferring to, and let them handle the rest.

« Last Edit: April 11, 2014, 02:20:03 PM by Frankies Girl »

Capsu78

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Re: How do I get rid of my financial advisor...
« Reply #20 on: April 11, 2014, 02:03:37 PM »
My break up meeting was memorable too- I called him to say I was coming over- he had his gal run out and get me a green tea.  He wanted to stage where I sat, so I could see his magic money making screen and he just started to sell, sell, sell... I cut him off, showed him my simple spreadsheet comparing his 1,2 year and lifetime performance ranked against my passive investments and showed him that he had never come in stronger than 3rd place by any measure.
He "redid" my maths, just  to make sure I knew how to use a calculator, bitched at me that I had never taken him up on going out to lunch or dinner (that's what I do with my friends- not my proctologist) and generally started spazzing out... then I thought of my wife, an executive who conducts a large staff who have learned that when she needs to make changes, she does... and what would I say to her if I gave him "one more chance to underperform".  I realized the conversation with my wife would be a worse conversation than the one I was in!  I stopped him and said " We are moving in a different direction..."
He stood up and buttoned his coat and continued to speak about the mistake I might be making... Exit- stage left!

Now, do remember that even after you "break up", you will still be relying on the guy to coordinate his end of your exit, so my advice is find the absolute path of least resistance- tell him to liquidate everything and have your new place sweep in with transfer paperwork that afternoon if possible!

About 2 weeks after my exit, I get a valentines day card from him, with little hearts that drop out as I open it, encouraging me to maximize my IRA before April 15!  My wife split her side as I opened it!  Fortunately no Easter Peeps in my mail box- maybe I have been deleted from his marketing rolls.
I now avoid driving down the block his office is on and I will NEVER have a financial relationship like that again.
 
« Last Edit: April 11, 2014, 02:08:36 PM by Capsu78 »

FuckRx

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Re: How do I get rid of my financial advisor...
« Reply #21 on: April 11, 2014, 02:39:43 PM »

I'm curious if you guys manage your own investments now or have better or different financial advisors?

nicknageli

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Re: How do I get rid of my financial advisor...
« Reply #22 on: April 11, 2014, 02:55:03 PM »
http://jlcollinsnh.com/2012/06/06/why-i-dont-like-investment-advisors/

If you're smart enough to get through medical school, my opinion is you're plenty smart enough to go it alone.  Just my 2˘.

I'm curious if you guys manage your own investments now or have better or different financial advisors?

Frankies Girl

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Re: How do I get rid of my financial advisor...
« Reply #23 on: April 11, 2014, 03:56:43 PM »

I'm curious if you guys manage your own investments now or have better or different financial advisors?

Completely self-managed now, and I was a complete rube in regards to understanding investing up until about a year ago.

And I agree with Wannabe, if you're smart enough to get through med school, basic investing should be cake.

Spork

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Re: How do I get rid of my financial advisor...
« Reply #24 on: April 13, 2014, 08:10:52 AM »

I'm curious if you guys manage your own investments now or have better or different financial advisors?

I'm not sure if that was aimed at a particular person or a general question... but I'll answer it anyway.   We had a "pro financial advisor" about 20 years ago.  He was a really nice guy with good intentions... in one of those "get lots of commissions" brokerage houses.  To his credit: He helped set us on a path.  He got us started doing math to save for "something big".  He got us to actually look at our expenses/income.  And he got us to invest in some highish load mutual funds.

I'm guessing he realized where he was... because he got out of the business.  And he did it about the time we realized we could just buy vanguard funds and do better.  That was about 20 years ago.  We've never had another advisor -- fee only or commissioned.

BUT... we're pretty middle class earners.  This is totally doable.  It's totally doable for a physician, too, but... I think it might take some more effort.  If anything, you might want someone fee-only that develops a plan to reduce taxes and (if it is important to you) to pass income to your heirs some day in a way that protects it.   

These may or may not be important to you, depending on your goals... And if not... probably not worth paying for.

nereo

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Re: How do I get rid of my financial advisor...
« Reply #25 on: April 13, 2014, 02:46:22 PM »

I'm curious if you guys manage your own investments now or have better or different financial advisors?
completely self-managed, with my only experience having an advisor being very negative.
I think anyone smart enough to graduate college can make a long-term financial plan and manage their money. 
Now that low-cost index funds and balance-funds are easily available to everyone (at least in the US and most other developed nations), it's easy.

bikebum

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Re: How do I get rid of my financial advisor...
« Reply #26 on: April 13, 2014, 03:49:12 PM »

thanks guys!
It's done, I was going to wait until I met with him in person but much like a significant other it's so much classier to do it over email :)
I basically said, thank you for your guidance and getting me started but I'm not ready to take it over myself and manage my own investments. Please help me complete my paperwork to transfer the money into my own investment accounts.

I'll start a separate thread to get some investment advice when I get all this done.
bold mine

Did you say you are "now" ready or you are "not" ready. I think if he knows you are choosing to do it yourself, rather than getting a different advisor, it is silly for his feelings to be hurt.

I self-manage my stash. I just do the passive investing advocated by the Bogleheads; no need to have an advisor for that.

Anyone else have Paul Simon's "50 ways to loose your lover" song playing in their head when they read this question?

I love this song! The drums during the verses kick ass!

dude

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Re: How do I get rid of my financial advisor...
« Reply #27 on: April 14, 2014, 07:23:38 AM »
He's a money guy, so he should understand that YOU want to keep more of YOUR money.  Recently went through a similar thing -- wife left old job about 7 years ago, so I contacted my friend who is a financial planner with one of the Big Brokerages to roll it over into an account with his firm (didn't know what else to do at the time).  In the last few years, looking at what he had her invested in and what the fees/loads on the funds were, it was no wonder he account hadn't grown much at all.  The friend recently left the Big Brokerage to go to another company and he sent paperwork to transfer the account to his new company.  I told my wife, forget it, roll it over into a Vanguard account, we're done giving our money away.  I'm much wiser after having been doing this for 10-15 years now.  Keep it simple, keep it diversified, keep it cheap, and keep cool and you will, as Warren Buffett himself said recently, outperform the vast majority of professional money managers.

There is literature aplenty out there regarding the corrosive effects of fees on one's investment accounts -- forward some of them to him if he doesn't get why you are dumping him.

EricL

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Re: How do I get rid of my financial advisor...
« Reply #28 on: April 15, 2014, 12:40:27 PM »
I was lucky.  I really liked my financial advisor, but the company was shady.  When I moved I changed to a new advisor for the same company.  When I caught him lying to me I dropped the company like a live grenade.


cjottawa

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Re: How do I get rid of my financial advisor...
« Reply #29 on: April 16, 2014, 11:31:59 AM »
Why even bother talking to an advisor you're leaving?

At least in Canada, the transfer to a new investment firm is done at the RECEIVING firm.

Just fill out their forms and they contact your old/existing broker. I've done this and helped friends do this. So much stress avoided.

You never need to talk to a shitty broker again.
« Last Edit: April 16, 2014, 11:43:46 AM by cjottawa »

MrFrugalChicago

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Re: How do I get rid of my financial advisor...
« Reply #30 on: April 17, 2014, 11:43:55 AM »
Why even bother talking to an advisor you're leaving?

At least in Canada, the transfer to a new investment firm is done at the RECEIVING firm.

Just fill out their forms and they contact your old/existing broker. I've done this and helped friends do this. So much stress avoided.

You never need to talk to a shitty broker again.

Same in the US, my new broker (Fidelity) did all the paperwork.