By iA Private Wealth, May 10, 2020
Choosing an Investment Advisor is one of most important long-term financial decisions you will make – perhaps even the most important. We recommend that you take a systematic, deliberate approach using this four-step process:
Step 1: Self-assessment
The first step is to identify your needs and goals and assess your financial position. It’s important to be as thorough as possible and to document this process in as much detail as possible.
Step 2: Choose your level of involvement
iA Private Wealth offers two ways of receiving investment advice:
Option 1: Advisory account
An advisory account allows you to maintain control over investment decisions while receiving guidance from an Investment Advisor.
Learn more about advisory accounts
Your advisor will share investment recommendations that take into account your current financial situation, goals, investment knowledge, risk tolerance, and time horizon. You will have the opportunity to assess and approve – or revise – your advisor’s recommendations before taking action.
Responsibilities
This type of account allows for close collaboration with your advisor for investment selection. To make the most of this relationship, a clear understanding of mutual obligations is vital.
Your responsibilities
Clearly communicate your investment objectives, risk tolerance and time horizon
Validate investment decisions
Stay informed on the progress of your investments
Inform your Investment Advisor of any change in your personal or financial circumstances
Your Investment Advisor’s responsibilities
Know your investor profile
Maintain regular contact
Demonstrate a proper degree of prudence
Present investment recommendations that are suitable for your profile
Option 2: Managed account
Also known as a discretionary account, a managed account is right for you if you prefer to delegate all investment decisions. With a managed account, your investments are overseen by a Portfolio Manager, which is a special type of advisor with regulatory approval to exercise complete discretion when building and maintaining your investment portfolio.
Learn more about managed accounts
After providing your Portfolio Manager with a clear picture of your current financial situation, goals, investment knowledge, risk tolerance, and time horizon, you’ll agree to an investment policy statement (IPS) that’s built around your profile. Based on the guidelines in the IPS, your Portfolio Manager will make all investment decisions on an ongoing basis. If your financial situation changes, the IPS will be updated and your Portfolio Manager will make future investment decisions in line with the revised IPS.
Please note that there is a $250,000 minimum initial investment to qualify for our managed account offering.
Step 3: Interviews
After settling on a manageable list of candidates, contact them by phone or Zoom to get a sense of their background and experience. Some key questions to ask at this stage include:
How many years have you worked as an advisor?
What is your training?
What is your approach to planning and portfolio construction?
Which regulatory and professional organizations are you registered with?
How are you paid?
Step 4: Follow-up meeting
Following your initial interviews, you should be able to reduce your list to a few names. Request a 30-minute follow-up meeting with each advisor to learn additional details about what they have to offer and if they’re the right fit for your goals and needs.
After these meetings, it will be clear which advisor is best suited to becoming your long-term partner for financial success.
