Determining your investment style is key to connecting with your financial advisor.
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If you work with a financial advisor, do you two have a personal connection? Does he or she “get” you? Do they have a deep understanding of what success means to you and what you want your wealth to accomplish?
If not, it may be time to move on.
In my experience working with top professionals such as wealth managers and lawyers, as well as high-net-worth entrepreneurs and families, I’ve discovered that a personal connection between advisors and their clients is as important to financial success as are traits like advisors’ competence and resources.
Why? A personal connection enables professionals and clients to communicate well because they understand each other’s motivations and how the other thinks about important financial and related matters. That communication and understanding are essential in enabling advisors to give high-quality and relevant advice to clients — and, in turn, in helping clients understand the advice and implement it to their advantage.
Nine financial personalities
One smart way to help ensure there’s a connection between you and your advisor is to work with someone who understands and respects your own unique “financial personality” — the “how” and “why” behind your attitudes and decisions about your finances and wealth.
The financial personality methodology was developed decades ago using well-established research protocols for creating psychographic segments, or personalities, using surveys of thousands of affluent and ultra-wealthy individuals. Since its development, it’s been proven to be exceedingly useful to help forge connections between professionals and entrepreneurs that lead to better outcomes.
Related: 5 Finance Choices You’ll Regret
To find an advisor who truly understands your financial personality, it’s often a good idea to know your personality first. There are nine financial personalities. Which one best capture who you are?
- Family stewards: The aim of investing, wealth planning and much of what they think about and do is to take care of their family. They have family obligations that always rank very high on what’s really important to them.
- Independents: They are striving for the personal freedom that financial and business success makes possible. They also want to have a solid safety net if it becomes necessary — or they just want to bail.
- Phobics: They don’t like investing, don’t understand it and don’t want to learn. They prefer to delegate investment duties to a financial advisor they trust.
- The Anonymous: For them, confidentiality is a dominant — often the dominant — concern. They eschew just about anything that involves sharing information outside of a small select group.
- Moguls: They are very concerned about parlaying their financial actions into personal power. They like to “keep score” with money and enjoy ascertaining who is winning and who is losing.
- VIPs: They are interested in social recognition and prestige. They view their business and financial successes as a way to achieve high status.
- Accumulators: Their primary (and sometimes sole) goal in life is to make more money. They want to do everything possible to grow and protect their personal fortunes because the more they have, the better they feel.
- Gamblers: They relish the adrenaline rush they get when they’re successful in business and in life. They’re problem solvers and thoroughly enjoy the process of investing and related activities.
- Innovators: They want to be at the cutting-edge of business and finance. They tend to focus on very sophisticated wealth management and family support solutions.
When you are self-aware about your financial personality, you can better evaluate a broad range of financial and legal professionals you might want or need to work with — wealth managers, lawyers, accountants and so on. Finding experts who can discern your personality and use that information to adapt how they explain concepts and strategies to you can help you make better decisions about your wealth. You’ll be more likely to be made aware of and take advantage of significant opportunities. You’ll also be less likely to make financial mistakes that could erode wealth.
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