WHY FINANCIAL ADVISORS ARE FIRED

What defines a financial advisor? Figures and performance. If these two do not get along, it is very simple for clients to leave his or her financial advisor behind and entrust their finances to someone else. No statistics can show how often clients ditch their finance professionals, but there are numerous reasons why financial advisors are fired.

Rita Gunther McGrath, an Associate Professor at the Columbia Business School shared her own experience with a previous advisor. She worked with them for seven years and ended up with less money than she had sent to them, saying they had a minimal understanding of her financial needs.

Covestor, a Boston-based investment management company, outlined the deal breakers that make clients :

Poor Performance. It pertains to professionals who produce short-term losses on a portfolio. Do not expect a client to pay high fees for inconsistent, lame performance from an advisor.

Lack of Attention. When the market is down, most advisors do not get in touch, write, and disappear. Also, these advisors do not return phone calls and emails in a timely manner.

Unreasonable Fees. Clients typically do not mind paying high fees when they are generating high returns. But, with the way things are going, they want to reduce costs. So, those who cannot cut their fees.

Human Interaction. Who wants to trust a professional who is not proactive in communicating with a client? Yes, clients can bear the market volatility, economic downturns, and erratic interest rate environment. But advisors should monitor the overall condition and update them from time to time.

Being Deceitful. No one wants to be kept in the dark, especially when it comes to finances. Clients want to know the plan is in place and the advisor is taking care of their money. That gives them a go signal to maintain and establish a strong working financial relationship.

Overselling. Most financial advisors tend to oversell their capacities, specifically over promise and under deliver. These professionals exert "effort" and make statements that are too good to be true in order to win clients. Clients are compelled to leave them if they feel they have paid their hard-earned money for (almost) nothing.

What links the financial advisor and client? Communication. Unfortunately, failing to communicate is the main problem. Why would they work with advisors who are always asleep at the wheel? It is important for advisors to keep their lines open for their clients, even if that means winning or losing.