Getting Behind the Wheel
The process of buying a new car can be exciting and also stressful. Maybe you know exactly what you want, the make, model, color, and all the bells and whistles or maybe you’re comparing a few vehicles on safety, price, and features.
A few years ago we were comparing a Toyota Sequoia to a Chevy Suburban. We needed a 3rd row seat and extra space behind for strollers, luggage, dogs, and all the kid-life stuff. There were features we wanted and things we didn’t care too much about. When we went to test-drive, we asked questions and pointed out things we didn’t necessarily like on each car, and it’s so interesting to see how the salespeople handled those things. In one instance a salesperson tried to talk us out of something we knew we wanted since the vehicle he was selling didn’t have that feature.
The hard part of comparing cars is if you go to a Toyota dealership, the salesperson is going to tell you exactly why the Toyota model will best suit your needs. At a Chevy dealership, they will sell you on why theirs is the best fit for you. The salespeople are paid by their companies to sell those cars, so their vehicle is the answer to each of the questions you ask.
You can and should do your own research and compare cars on the priorities you care about the most. But wouldn’t it be great to have one person who wasn’t tied to any particular car company? A person who really got to know you, and what you needed from your next vehicle? A person who had universal access to all the cars and worked to find the best possible fit at the best price for you?
This is the common scenario in the financial planning world as well. People hire a “financial adviser” (which by the way is not a regulated title – anyone can call themselves a financial adviser) who works for a specific bank or brokerage firm, therefore those advisers are limited to recommending solutions from their company. A bank’s adviser isn’t likely to recommend a mutual fund from Vanguard, even if its the one that best fits your personal needs. And even if he does offer a solution from a different company, it usually is not first on the list because he probably gets paid less if you choose that one.
Choosing a fee-only financial planner like Avant Financial Advisors means that we work for you, not a brokerage or an insurance company. You pay a transparent fee for independent advice specific to you and your family. We work every day to know the extent of the financial world and aren’t biased in what we recommend for your financial goals. You can trust us to do what’s best for you (that’s called “fiduciary”) and know that we aren’t getting paid by another company to sell something to you that you may not necessarily need.
When you go to a car dealership, you know how the sales person is getting paid. And so you take their advice with a grain of salt. But this isn’t always the case when looking for financial advice. Sure, choosing an adviser who doesn’t charge a direct fee can seem like a good move because it is cheap up front. Realize, though, that advisers don’t work for free. They are getting paid, and it is in your best interest to understand exactly what conflicts of interest they may have.
I didn’t fully understand this until I worked in the industry and saw how other advisers operated. If you have questions, reach out to us and let us help! We’ll work for you in all aspects of your financial life. Car-shopping and all.
