Building a Long-Term Relationship with Your Financial Advisor

How do you envision your relationship with your financial advisor? While the answer to this question may vary depending on your needs and circumstances, it’s common for clients and their professional counterparts to be in it for the long haul. Sometimes, you could work together for years to make your goals a reality.

In this article, we’ll outline five factors to consider as you build a long-term partnership with your financial advisory professional or firm. We’ll outline ways to identify the right professional, the value of setting expectations and establishing trust, and how to communicate properly and effectively.

Look for the Right Qualities

Before working with a financial advisor long-term, ensure you get the right expert or firm for your needs. This will help your arrangement stay productive and effective, giving you more confidence in accomplishing your objectives. One way to do this is by looking for specific professional qualities or traits.

A primary characteristic to look for is an advisor’s experience. How many years has the individual or firm worked in the field? Overall, it’s a rule of thumb to look for professionals with several years or decades serving clients with similar needs.

Professional credentials are also an indication of experience, ethics, and expertise. Therefore, they can be a good way to assess quality and whether an expert fits your criteria. For instance, individuals with reputable titles and designations such as Certified Financial Planner (CFP), Chartered Financial Analyst (CFA), and Chartered Financial Consultant (ChFC) must complete extensive and wide-ranging educational, ethical, and experiential requirements.

Beyond credentials, pay attention to your financial advisor’s communication skills and approachability. An expert should communicate plans and steps clearly and fully. You should also feel comfortable asking questions or presenting worries to your advisory professional. Firms and professionals should be easy and comfortable to contact, especially if you plan on cultivating a long-term arrangement.

Additionally, how does your advisor approach financial planning or investing? You and your expert should align, at least in one or more ways, on the philosophies for your portfolio from both a planning and investment perspective. Ultimately, this could impact the advice you receive over time and will be meaningful if you work together for a long time.

“What matters most is how well your advisor communicates, listens, and aligns with your vision,” emphasizes Gerry Barrasso CPA, CFP^®, PFS, founder and president at United Financial Planning Group.

Finally, ensure you and your advisor can get along personally. Do you enjoy talking to each other, and do you have anything in common? Sometimes, it can be easier working with someone if you share interests and approach the relationship in a friendly way rather than strictly business. This could make visiting your advisor more of a pleasant experience than a chore.

Set Clear Expectations

A vital part of fostering a long collaboration with a financial advisor is setting clear expectations—for both involved parties. While it may vary, this generally includes understanding each person’s role and responsibilities, goals you intend to work toward, and preferred modes of communication. In doing so, you’ll be better positioned to align on where you want to go as a client and how your advisor can help you.

Roles and Responsibilities

The roles and responsibilities of a client and advisor may vary by relationship. However, they usually depend on your needs and the level of authority your advisor has over your holistic financial picture.

If you’re looking for a retirement plan or budgeting strategy, you often must implement the advice yourself. This would mean an advisor would deliver a plan to you based on what you’ve discussed in meetings; however, you would be responsible for carrying it out by starting accounts, saving money, or buying and selling assets, for instance.

For portfolio management, however, a professional or company may have more control over your account, either making trades with or without your approval depending on your contract. These roles and responsibilities usually get spelled out in an Investment Policy Statement (IPS), which outlines the authority of an advisor and the accountability standards you and they must follow.

Goals

You’ll also need to set expectations with your professional on the goals you want to reach throughout your relationship. For example, in an initial consultation, an advisor may assess targets such as buying a house, education planning, retirement, or managing debt. They may also ask for information about your circumstances, including savings and expenses, income, investable assets, and net worth. These details will coincide to inform the kinds of strategies or management styles your financial advisor may implement or recommend.

Communication and Meeting Preferences

Establishing communication preferences will be key when building a long-term relationship with your professional. You’ll need to discuss how often you’ll meet, at what time of day, and whether you prefer talking over the phone, on video, or in person at an office or public place.

You may also decide whether you want to receive statements and updates by mail or in a paperless format. As we’ll discuss further, it will be important that your advisor makes it easy and seamless to communicate effectively with one another.

Share Trust Through Transparency

Trust is a foundational element of working alongside a financial professional, as it allows you to feel comfortable that your advisor is providing you with the best possible support and direction. However, this is attainable when both parties are fully transparent with each other on various aspects of the relationship, whether it’s the fees you’ll pay or how much money you have for investing.

One way for an advisor to earn trust is by staying upfront about their fees and compensation, services, and investment philosophies from the beginning. “When clients know exactly how their advisor is compensated and how the firm operates…trust grows,” says Barrasso. Knowing how your advisor makes money for the services you receive allows you to make informed decisions on whether to stay with a firm or go somewhere else.

Another trust signal for an expert is being a fiduciary, a standard that advisors with reputable credentials and registrations must uphold. This demonstrates that they’ll put your interests first, avoid conflicts of interest, and adhere to strong legal and professional ethics. In short, it provides a useful framework for clients and governing organizations such as the U.S. Securities and Exchange Commission (SEC) to assess the quality and trustworthiness of professionals and the firms at which they work.

Likewise, it’s just as necessary to exhibit transparency with your financial advisor as a client. This might include providing complete information about your income, how many debts or liabilities you have, or broader information such as your objectives and risk tolerance. This enables your professional to have the full picture of you and your finances and give more effective guidance.

Communicate Frequently and Completely

Consistent and detailed communication is another central aspect of an ongoing advisor-client relationship. Meetings and information are a good opportunity for both sides to stay on the same page and keep a baseline of trust, as discussed above.

How often should you meet with your advisor? This “depends on the complexity of the client,” says Barrasso. He notes that “annual check-ins are enough” for some clients, perhaps especially if you have a rather uncomplicated situation. But on the other hand, “Those who are in the middle of big life events like selling a business or retiring may need more,” he says.

More involved clients may require monthly or quarterly reviews. And if your advisor is in a managerial role over your portfolio, regular performance updates are essential to keep you informed and maintain transparency.

While frequency is important, the details are most significant. You should reasonably expect your advisor to explain carefully and fully what’s going on and let you ask questions whenever possible. On the client side, be sure to pay careful attention to your advisor’s advice and, if applicable, the management of your account. Then, ask questions whenever they arise. A good professional should be able to listen and give you thorough answers.

Be Adaptable Together

Advisors often recommend changes to keep up with transforming circumstances. Fluctuating market conditions, shifting priorities in life, and windfalls can influence your strategies and, in some cases, be common reasons to move in a new direction. Therefore, you and your professional must be willing to adapt together and stay current on opportunities to improve your plans.

“Financial plans are not static. Life changes—like marriage, divorce, a career shift, or retirement—require ongoing adjustments,” explains Melissa Murphy Pavone, CFP^®, CDFA^®, financial advisor and founder of Mindful Financial Partners. “Clients should expect their advisor to proactively identify opportunities for optimization and communicate changes clearly. It is our job to be proactive, not reactive,” she adds.

Though changes are typical and may occur throughout your relationship, you and your advisor must maintain a dialogue about what’s different and how it fits your situation and client profile. “Transparency about why adjustments are being made, coupled with a focus on how they align with the client’s evolving goals, ensures confidence in the process,” says Pavone.

While it’s good to be at least open to changes as a client, it’s also beneficial if an expert is adaptable to new methods and strategies over the years. One way to do this—and a common requirement from issuing organizations of titles—is continuing education. It’s a positive sign if your advisor regularly keeps themselves fresh on the current best practices of financial planning and portfolio management.

It’s also good if your advisor responds well to performance concerns, making it easier for both of you to make changes and get back on the right track. “Clients should speak up right away if they believe their portfolio is underperforming. A good advisor won’t get offended and will be able to explain what is happening,” Barrasso advises.

Bottom Line

Depending on your goals, you and your financial advisor might cooperate for multiple years or decades. From the beginning, it’s wise to be careful when selecting your professional and establishing the foundation of your relationship, including expectations and communication standards. Ultimately, it should be a person or firm with the right expertise whom you trust to deliver helpful advice.

If you’re still on your search for an expert, we recommend using a free matching tool, such as this one. After answering a short list of questions about your circumstances, it will pair you with a vetted advisor who fits your needs.