The Secret Society of REAL Financial Advisors

Last Monday I was fortunate to be involved with the visit to Dublin of Carl Richards, an internationally acknowledged speaker on Behavioural Finance. Carl hails from Utah, USA and is a regular contributor on personal finance to the New York Times. Carl spoke to a room of over 100 Irish financial advisers at an event which myself and my colleagues from the Society of Financial Planners of Ireland arranged. Carl’s particular skill is the ease in which he explains financial issues, mainly by the use of simple drawings.

One of his focus points was on the need for ethics in financial planning and the fact that many good advisors get overlooked by clients in favour of some of the more assertive yet less capable individuals. Usually such overlooking comes about because they are too respectful towards their potential clients and less boisterous in expressing their opinions.  This, he said, was not just an Irish problem but an international one to which he proposed that such good advisors should market themselves as someone who is a member of the Secret Society of REAL Financial Advisors. Having listened to him I would agree wholeheartedly especially with the attributes used to describe such REAL Financial Advisors as they fit in with our approach to dealing with our clients. They are also a benchmark for anyone looking for an advisor in the first place.

Carl’s list of the 11 attributes of such individuals that needed to be disclosed to existing and potential clients are:

#1   Real Financial Advisors are boring  – They don’t sell the latest sexy investment idea  and are possibly not the life and soul of the party. Their focus is to advise you and your family for the whole of your life by maintaining consistency and stability in your finnacial affairs. If you are looking to get rich quick, you don’t need a financial advisor. You need a bookmaker’s shop and an awful lot of luck.

#2   Real Financial Advisors are professionals – Real financial advisors always take time to continue their education and improve their professional standards. You won’t see the results very obviously but you will know that they are continually improving their professional capability.

#3 Real Financial Advisors are independent – Independence confers an ability to stand back and not be compromised by either the products that their firm sells or the marketing strategies of the financial institutions that pervade in the market place.

#4 Real Financial Advisors get compensated by their clients – All costs are declared and earnings are transparent. While this is enshrined in the Codes of Conduct that regulate the Irish financial services industry, too often many advisers fudge on this and hope that they clients don’t ask awkward questions.

#5 Real Financial Advisors put their clients interests first – While this might seem obvious it is critically important. Sometimes it is a hard one to swallow if you are an advisor as it may sometimes mean that we do ourselves out of earnings and encourage you down a different path even recommending that you do not take any specific action.

#6 Real Financial Advisors diagnose before they prescribe – A real financial advisor will take the time to listen and consider before making recommendations. Sometimes this might even take a few weeks as they may wish to undertake research. Remember financial planning is a long term project and not a short term fix.

#7 Real Financial Advisors ask really great questions – We try to get inside the important issues and encourage you to think about your future life goals. After all, you cannot advise anyone about their money unless you know how they will eventually want to spend it and what are the most important issues facing them.

 #8 Real Financial Advisors are worthy of trust – Sometimes saying this is almost making a statement that you cannot be trusted and are trying too hard to appear honest. Trust is earned over time and is garnered only by demonstrations of integrity and honesty.

#9 Real Financial Advisors make things as simple as possible  – Any advisor who makes financial matters complicated is trying to blind you with science and has lost sight that the client is the most important person. If a particular piece of advice cannot be explained simply enough for you to check it yourself, then you might want to take a step back from dealing with that advisor.

#10 Real Financial Advisors know that you need financial advice about your money, your goals and your plan – Everything in life has a financial consequence. Once you, as a client, understand this principle you will focus on the right issues. What you don’t need is someone who is pushing a specific product or investment fund, especially one that their firm has some association with – again, see independence (point 3 above).

#11 Real Financial Advisors focus on things we can control – Investment markets wait for no-one and neither does life in general. There is no point in spending a lot of time stressing out about issues we cannot control. Focus on the things you can control – spending, saving, borrowing and making balanced investment decisions.

If you like these declarations  and think that you would like to deal with us, contact us for a Discovery Meeting at (01)8455827.

Carl Richards is Director of Investor Education at BAM Alliance, USA network of financial advisors. He is a CERTIFIED FINANCIAL PLANNER™, Blogger and Columnist with the New York Times. You might like to check out his book, “The Behaviour Gap”, which is a great read for anyone interested in investing and financial matters. His website  can be found at

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