Choosing how to obtain financial advice, especially during a major life transition can feel overwhelming and that’s the reason Drew Richey and Shawn Perry penned their new book, Finding Your Financial Advisor. They aim to help you understand the basics of the financial services industry and confidently hire a wealth management team that best suits the needs of your family, as the decision you make in hiring an advisor extends beyond your immediate needs into the future wellbeing of your family and your legacy.
Hey listeners, my name is Drew Applebaum and I’m excited to be here today with Drew Richey and Shawn Perry, authors of Finding Your Financial Advisor: How to Understand the Industry and Confidently Hire the Best. Drew, Shawn, thank you for joining, welcome to The Author Hour Podcast.
Drew Richey: Thank you, we’re glad to be here.
Shawn Perry: Yeah, thank you so much.
Drew Appelbaum: Can you help us kick off the podcast and respectively just give us a brief rundown of your professional background?
Shawn Perry: Yeah, this is Shawn. I started in the financial industry in 2000. Drew and I started working together not much longer after that, we built a team from what started as three individuals up to 11 people and we’re really passionate about helping individuals and trying to professionalize our industry.
Drew Richey: Yeah, I think that said it well. Shawn and I have been working together since 2005 but we started together, we were considerably younger at that point but kind of grew up in the industry together and built a business out of it.
Drew Appelbaum: 17 years later, I know it probably sounds wild saying that but 17 years later. You’re coming here and you’re telling your story and you wrote this book. Why was now the time? Was there something inspiring out there for you, did you have an “aha moment” or you just want to tell the masses the knowledge you’ve gained throughout the years?
Drew Richey: You know, writing a book is something that we felt like probably for 10+ years, it was going to be on our radar. We feel like the way we run our practice for that time period and much longer feels a little different. You know, the experience, we strive to provide an experience that people want to come back again, and want to tell their friends about as we say often within our team.
We felt like at some point, it was going to be the natural progression of what we do to try to have a bigger influence cast a wider net and really changed the industry that we’re working in for the better. We’re huge advocates of promoting within our community and our network and trying to help as many people as we can, so we felt like writing a book was going to be something that we were going to take on at some point and we just felt like now was the right time, you know?
The book focuses on how to work through the process of hiring a financial advisor and I’d say, it’s a little bit of a pet peeve that Shawn and I have that there’s just not a great way to tell the difference in all the options that are out there and we felt like people need some help with it and felt like now is the time to go ahead and get that out in the market place.
Drew Appelbaum: Now, when you started to write the book, in your mind, was there a particular audience that you were writing this book for?
Drew Richey: Yeah, I’ll start with that, and we co-authored the book, so Shawn may have a different take on this but for the portions that I was kind of working through on paper, I couldn’t help but picture my mother, okay? So I was thinking about, if she retired from the school system, she accumulated X dollars, she’s got a pension, she’s got some social security and I just need to figure out how to make this life and I need some help.
She wouldn’t know where to start, right? She doesn’t know people in the financial industry, people in the business community, she may have a friend she could ask but it’s really written specifically speaking, to that one person who doesn’t know, even where to begin with looking. I don’t know what the different options are out there, they don’t know how to compare them, they don’t know the questions that they need to ask and they’re already in transition, right?
The scenario I just described would be someone going through retirement but most oftentimes, people, when they’re either seeking advice for the first time or hiring a new financial advisor, it’s because they’re in some sort of major life transition and we like to say that you know, the stress of that, plus information overload equals anxiety, right? So, they’re already anxious about the situation they’re in.
Now, they’ve got to go through that process of hiring someone to help them and they don’t know where to begin. So that was really kind of the aspect that I took when I was sitting in front of my iPad, trying to work through the content.
Shawn Perry: I think also, just years and years of meeting with people for the first time and them asking the question, “Well, how do I know how you’re different than someone else?” or “What should I look for when I’m looking for a new advisor?” It was always interesting that in a meeting, people would ask you that question even though you’re the one that people that they’re talking to about it.
It’s like, “Well, I don’t know how to differentiate you versus someone down the street.” That was a big motivation for us of just trying to level the playing field, empower your average individual to be able to make an educated and informed decision.
The Advisor-Client Relationship
Drew Appelbaum: I do want to dig into a few things that you both just mentioned but first, if you wouldn’t mind setting the foundation for us, for people that don’t know or just really want to be educated, what exactly do financial advisors do and what services do they offer?
Shawn Perry: Well, that’s part of our book in the defining your minimum standards, we talk about the services offered and I think this is one that we’re really passionate about in the sense that how most people would answer that, how most financial advisors would answer that, is through some specific product they have, some financial planning process they have that they would say is really unique or some other type of thing and we feel like —
Drew Richey: Investments, investors that [often want to] just dive into the investment process or stock or fund pickings because they can.
Shawn Perry: That’s right and we would say it has a lot more to do with finding a relationship that you’re comfortable with, finding someone who has taken the job seriously looking at accreditations, so that the one who is really taking the education aspect of it seriously.
Drew Richey: You know Drew, we say — we kind coined the phrase, and we talk about it a lot in the book, but the financial advisor should really be more of a financial advocate for a family. You know by definition; an advocate is someone that acts on or promotes a specific call or acts on another’s behalf in someone’s best interest.
We think that that terminology when it comes from other industries, but we feel like, acting in someone’s best interest on their behalf to address the right things in their life at the right times, is truly what a financial advisor should be doing for the families and the individuals that they work for.
When that conversation begins with anything other than figuring out what someone’s true needs are, why they’re there in the first place, what stressor or anxiety is brought them to seek this new advice, this new relationship, if it begins with anything other than that, that’s a red flag that we see and we think that’s truly what a team of financial advisors should be doing.
Drew Appelbaum: What can actually go wrong? Tell me the red flags, tell me what it looks like when the advisor-client relationship is not as you just mentioned and is less than perfect?
Drew Richey: Sure, it’s usually when the relationship begins focused on some sort of goal that you know, that it’s either not realistic or set the expectation is built on something other than focusing on what’s most important to that client.
So typically, when a client goes in for an initial interview with an advisor, they’re going to say, “Yeah, we need to bring your statements, bring all your financial information, maybe a personal financial statement, I’ll take a look at things” or even send them to them in advance and we say that the initial discussion is only going to be your list of questions.
We try to empower people by helping them know, “What do I need to ask?” and now, first off, we suggest not interviewing any advisors until you decide what are your minimum standards for hiring an advisor and we help people lay those out in our book of course and provide some additional resources like a pre-meeting checklist.
We think that you should pre-decide before you start interviewing, what are you looking for, what kind of education, how do you do a background check, are you looking for a team or a solo practitioner that you can connect with, and what services are offered, those types of things.
So, as you’re going through that process, really, knowing first what you’re looking for, making sure they meet your minimum standards, and then going into that interview prepared and not letting them lead the conversation as much.
The advisors should talk very little in the first meeting, it should be more about focusing on what’s important to the client or the family. We really try to get away from the client’s word. I mean, these are families and individuals with unique circumstances. They’re not just clients or customers or how the industry talks about them.
Shawn Perry: One of the things that really resonated with us through the book publishing process is the artwork that we decided on, on the cover, which is a needle in a haystack and we felt like without the tools and knowledge, finding the right advisor was really like that for people and it was through this book that we could simplify that process and hopefully, not make it like that, looking for someone is like finding a needle in the haystack.
Drew Richey: Yeah, it’s a real shame that it’s like that. There are so many financial advisors — even though in our hometown where we’re located, I don’t know how many registered advisors there are — maybe a hundred or so, it seems like. You know, and there’s a lot of good ones, we want to say.
So first off, Shawn and I are not in any way advocating that there are not a lot of good financial advisors out there, it’s just the calls of barriers to entry because of the way the industry is developed, there’s a lot of other options out there that you can’t call yourself a doctor or an attorney unless you pass the bar exam or went to medical school.
You can call yourself a financial advisor with pretty minimal training especially if you are not regulated by the main governing bodies.
When Is The Right Time to Start Looking For A Financial Advisor?
Drew Appelbaum: You kind of touched on this a minute ago, after you meet those minimum requirements that you’re looking for, what are the right questions to be asking before you sign on with an advisor?
Shawn Perry: I think there is a lot. You know, we break down the interview in four main categories that are tied to the core values we have here in our office and those four are wisdom, discipline, transparency and humility. The wisdom speaks to specializations within the team, how do they coordinate with other professionals? Do they have a client education program? The list goes on and on through each one of those categories about different types of questions.
We’ve created a hiring guide that Drew referenced earlier that is on our website, findingyourfinancialadvisor.com, that actually lays out sample questions that individuals and families can use when they are going through that process.
Drew Richey: Yeah Drew, one of the specific questions that comes to mind and it is just fun to ask this question because we know how a lot of teams work. 20 years ago, there were not many teams in our industry at all. That was about the time that people begin, you could actually go to college and get a degree in personal financial planning. A certified financial planner designation became very well-known and prominent.
So you started getting these older successful advisors hiring younger college grads with a degree in financial planning and they started building teams. It is fun to kind of dig into what does their team really look like, do they have specializations within the team or is the team really built more to serve the advisor and that advisor is out of town on vacation or whatever they’re doing just to have office coverage.
We just have it in the book a lot, are they more like a golf team where they all go out and play the same day and they total their score at the end of the day, or are they more of a basketball team, where they each have a unique role in the group and you really can’t function if one of them is gone, right? If your point guard is gone, you just can’t do anything. Getting down to what kind of team do they have and is it built to serve that client better or is it built to serve the advisor? That is definitely one of the most important things to figure out in the interview.
Drew Appelbaum: I think for a lot of people as you mentioned, they start looking for an advisor at the wrong time during sort of a hectic transition in life, retirement, the death of a loved one or things along those lines but should everyone have one now? Is there a certain amount you have to have in the bank? You have to earn a certain amount. I think some people are saying a team, “I don’t even know if I should be having a financial advisor.”
So, when exactly is the right time in somebody’s life or just everybody should start looking into this now?
Shawn Perry: I think the answer is different for different people. The individuals we want to work with and that we can help the most are people that have reached the point where they feel like they need help, and some people think they can do it on their own and that’s great. I mean, we encourage that, so we don’t spend our time trying to convince people to do it on their own. They should do it with us.
We want to find people that want the help, they want the specialization, they want the expert opinion, and they are opting in into that and that varies. I think a lot of times you think it is just people in retirement, but it could be a 30-year-old that’s been accumulating assets and they finally reached a point where they’re like, “Okay, I’ve been doing this myself but now because I have X amount of dollars, it’s become more complex and I need more help.”
Drew Richey: Yeah, and Drew, I’ll add in the book, we talk about a lot of the different types of engagements that you can have with a financial advisor. The different types of cost structures, the different types of planning engagements, or investment services. So this is not a guide that just directs people into how we do business ourselves. Now, we run a practice as well, we have a certain way that we think a business should be running.
That is the way we conduct our practice, that’s not for everybody. When should someone get an advisor, well, there are a lot of different types and those types of advisors are structures of businesses that may change as the client’s needs change over time, right? So they may start with an advisor and then at some point in their life, you know, they may grow out of that type of engagement for lack of a better word and seek new advice.
It can be hard, you know, your question is they’re going through these and times of transition should they do that before. Well, sometimes until you’re in that transition it’s hard to figure out what you really need. We’re not advocating that, “Hey, while everything is great, you should really figure this out. We are just trying to empower people to be confident as they go through that process when those transitions come.
Drew Appelbaum: You actually added a lot of resources at the end of the book. I think you really want people to continue doing the research and to continue building the foundation, understanding more about their finances. So can you talk about what readers can find in the resource section of the book?
Drew Richey: Yeah, for sure. So the book itself is about a 60 to 70-minute read, really just to help empower you, give you a broad understanding of what your options are, why you need to take ownership, how to set the minimum standards, and go to the interview and what to look for in the interview but after that, we don’t want people to just be on their own to figure it out. So we developed three resources, all combined into one document called, The Hiring Guide.
They could request that on our website, it is completely free on our website. We will send you a copy of that, but it is three pieces combined into one. The first is a pre-meeting checklist, so a really simple guide to help you walk through the five minimum standards and really determine first what your five minimum standards are going to be and then some direction on how to dig into that information. Typically, on the advisor’s website or just some minimal research, you can figure out if they meet those.
The second piece is that the advisor interview questionnaire. So it lays out our core value approach to wealth management, wisdom, discipline, transparency, and humility with the subsections and it gives you some sample questions that you may want to ask in your meetings and then depending on how all of those things go, in the end, we have a post-meeting score card, where you can actually rank how you feel like your advisor team scored in each of those sections.
So I do want to point out that the very last piece of that, we’ve got five minimum standards, four major core values we’re trying to identify but the tenth one and perhaps one of the most important is that gut check at the end. We say, “How did it make you feel?” We believe that any advisor-client relationship should ultimately leave the client feeling confident, comfortable, and connected with whom they’re working with and that may trample that score somewhere else, right?
Because you can work through some things that may be missing in the relationship but if you feel confident, comfortable, and connected to this group and the trust is there and the relationship is there, then that is going to work. So that is a really important part of that final piece on the scorecard.
Drew Appelbaum: You also have a companion website with the book. Can you tell us what the address of that site is and then what readers and listeners can find there as well?
Shawn Perry: It’s findingyourfinancialadvisor.com. So just like the book spelled out, as Drew mentioned, we have the hiring guide on there. We’ve got a short video from our group, we have a link to purchase the book on there.
Drew Richey: Yeah and then as well as our podcast and someone could sign up for our ongoing newsletter as well. So we put out a lot of content, which is something that we talk about in the book. We think that empowering readers with wisdom and knowledge is essential. So we do a quarterly kind of non-client but we call it our community newsletter. We said earlier that an advisor should really be an advocate, right?
So we call the newsletter, The Advocate Advantage. They can sign up for our newsletter, listen to our podcast, buy the book on Amazon or download a copy of The Hiring Guide right there on our website.
Drew Appelbaum: Well Drew, Shawn, thank you so much for joining. We just touched on the surface of the book here, there is so much more inside but just putting this book out there just to help educate folks on finding the right advisor or team is no small feat. So I just want to say congratulations on being published.
Shawn Perry: Thank you.
Drew Richey: Thank you very much.
Drew Appelbaum: It’s been a pleasure. I’m excited for people to check out the book. Everyone, the book is called, Finding Your Financial Advisor, and you could find it on Amazon. Drew, Shawn, besides checking out the book, besides the website, is there anywhere else where people can connect with you?
Drew Richey: On our own website, which is where you can find us under the Perry Richey Group. We work with Baird Private Wealth and you could Google that word, theperryricheygroup.com.
Shawn Perry: I love for people to reach out. Thank you. Thank you for having us today.
Drew Appelbaum: Yeah, thank you so much for joining, and best of luck with your new book.
Drew Richey: Thank you.
Shawn Perry: Great, thanks.