Why I don't like the term: "Financial Advisor"

 

Traditional “Financial Advisors” are not trained to serve their clients holistically. Their telescopic approach fails families and does not properly preserve their client’s wealth.  A better way to describe me would be a Holistic Wealth Advisor. Now let’s get back to what happened, the role I played in it, what I learned, and why I may be the best advisor you could have now.

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WHAT HAPPENED 17 YEARS AGO. In 2005 we hired a Hedge Fund Manager to manage a portion of our client’s portfolios and they did fine until the crash of 2007 when they lost $38M of our clients’ money, including our own.

 

MY ROLE IN IT. In looking back, I take 100% responsibility for my actions which contributed to that loss when I:
 

• Retained the Hedge Fund Manager without first running it by my Broker Dealer and getting their approval

• Ignored the warnings from one of my investment gurus who outlined that the trading system used by the Hedge Fund Manager exposed my clients to a lot more risk than I had shared with them

• Placed too much of my client’s portfolios into the Hedge Fund thus not providing them with proper diversification

• Did not audit the Hedge Fund Reports thoroughly

• Chose to use a Hedge fund that was not regulated by either the SEC or FINRA

 

WHAT I LEARNED. Even though it was one of the worst failures of my entire life, I have learned some very valuable lessons:
 

• Never use an unregulated Hedge Fund to manage client’s money

• Even if you trust someone, always verify oral representations

• Don’t ignore the warnings of someone who has more wisdom than I do

• Always achieve proper diversification for my client’s investments

• Do not overpromise and underdeliver

• If I do not fully understand 100% of the risks involved in a financial vehicle, then do not recommend it

• Do not ignore regulator's requests for additional information when I have the power to provide it

 

HOW I CAN KEEP THIS FROM HAPPENING TO YOU. Considering what I experienced, I have made some very important changes when it comes to making the most suitable recommendations to my clients:
 

• Only use innovative insurance solutions for our clients that guarantee that our clients cannot lose money due to market drops

• Fully measure each client’s risk tolerance and recommend financial solutions that fit them

• Do not allow our clients to make financial moves without 100% transparency

• Look holistically at every client with an eye for reducing risk in all areas of their lives

• Share with our clients the worst thing that can happen with any specific financial move they might make and ensure that they understand the likelihood of it occurring

• Only recommend what is in our client’s best interests regardless of any compensation we may or may not receive

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