The Monkey and the Banana

Does it really do you any good to pay someone for financial advice if you are not going to follow the recommendations 100%? After our second meeting, my wife and I have decided to sign on the dotted line with our financial partner. The problem is that while the recommendations that were given to us are quite sound, they involve getting rid of the vast majority of the stock that I own in the company I work for. Having been employed by the same company for 20 plus years, you can imagine the conflict that has created for me. I believe in the company, the leadership, the business, and the people I work with. The industry is highly impacted by housing, so the stock price has been significantly pounded over the last several months. While I don't have a crystal ball, I feel strongly that the stock will come back when housing rebounds and I am confident that it will rebound. Home ownership is still a big part of the American dream. My adviser's recommendations are sound, but my emotional attachment is not letting me go with the sound advice he is offering. He certainly hasn't given me an ultimatum, but he did tell me a story that I would like to share. He asked me point blank if I knew how to catch a monkey without a tranquilizer gun. Not having a good answer, I took the bait (no pun intended). He pointed out that it was quite simple to do. All that is required is to drill a hole in a box and put a banana in it. When the little guy reaches through the hole and grabs the banana, he won't let go. Kind of like I have grabbed onto my companies stock and won't let go. Not that it is a bad stock. I am sure the banana isn't bad either. My adviser pointed out that his recommendation is promoting what he feels will be a safer and more profitable portfolio. Gee, isn't that why I wanted a financial adviser in the first place?

I wonder if there is a way to eat some of the banana and then let go? I am not sure that I can let go of the banana entirely. Every day I see my stock price dip lower with the rest of the market, but know that we are positioned well for the rebound. We are cash rich and still making money, just not as much as the analysts would like. I have always felt that if the basic fundamentals were intact and if you believed in the stock, that you should ride through the tough times. Do I cut the cord, or do I bite the bullet and continue to ride the horse. I don't think I am going to get a partner in this one. The adviser doesn't have the emotional attachment to my company so he is making his recommendations with an open mind. I agree with everything else he has recommended, and even this makes logical sense. It just doesn't feel right. How do I get past this. I hate monkeys!

Picking a Financial Planner

How do you pick a financial planner? Can you say Google? Type in financial planner and your city, and you will be served up an abundance of planners to choose from, or not. Unfortunately, just because someone is listed, doesn't mean that you should entrust your future to them. You must determine if they are legitimate and that they are not just someone just waiting to get their hand in you pocket. Read, read, read, read! Educate yourself on what to look for. You can find all kinds of information by doing basic searches. You will learn that there are many ways that financial planners get paid. Some receive a fee based on a percentage of your portfolio while others receive commissions on transactions they make like buying and selling stocks for you. Still others are paid a salary and receive bonuses from financial services firms they are employed by. They can be experts on stocks, insurance, annuities, bonds, or maybe nothing at all. There are planners that are certified and regulated by the Certified Financial Planner Board of Standards, Inc. You can go to the Financial Planning Association's web site and do a search for a certified planner. You can also find a planner by asking friends and family if they are using a financial planner or know someone that they can refer you to.

Which ever method you use to find a financial planner, your work does not end there. You must then meet with the planner and interview him or her thoroughly. Ask lots of questions. If you don't feel comfortable with the person, then move on. The first individual that I met with I did not particularly like. My wife liked him and felt ready to sign on, but I wasn't comfortable. He tried to get us to sign a contract with him with the promise of a full refund if we decided that we weren't happy at any time during the first year. He seemed to be more of a salesman than a potential partner. We refrained from signing and told him that we wanted a few days to make a decision. I am glad we took the time. My wife's boss heard that we were talking with a financial advisor and he provided her with a name of an individual he had done business with in the past. This referral turned out to be a great fit for us. We were better prepared when we met with the second financial advisor and found him to be well educated, experienced, grounded, and someone that we both were instantly comfortable with.

Our first meeting went very well and we decided to go back for a second time to see what type of plan our potential advisor would lay out for us. We provided him with all of our financial information so that he could review it and make some recommendations. That in itself was hard for me to feel comfortable about. Handing over information that one would normally keep confidential was not easy for me. Trust is critical for there to be any chance of forming a strong partnership with a financial advisor. Prior to accepting the recommendations there would be cause for many more questions and a lot of soul searching. With more questions to ponder I am sure that I will suffer through a few more sleepless nights.