Have you ever asked yourself this question, “what do I expect from my wealth managers?”
Is it goal setting? Accountability? Administrative help? Investment performance? Tax saving? All these may be part of the decision, but have you defined what is more important to you?
From various research, investment performance is at the top or close to the top.
It makes sense. Would you ask for help to get the worst investment results? That would be crazy. I recall listening to a philanthropical individual a few years ago who said, “I’m quite capable of losing money myself, so I don’t need professionals to do that for me”. He’s absolutely right. So if you don’t look for the worst returns, are you looking for average returns? It is perfectly possible you may be happy with average, but have you put context around ‘average’. What does average really mean? If you’ve clearly defined it and you are happy with average, that’s fine. I would argue, however, that investors don’t seek average. They have an expectation of greater than average. In other words, by default…if you are not investing for the worst or average returns, you must be shooting for above average. The industry calls that ‘outperformance’
Its why most people will expect outperformance. But do you get it? Most don’t even when they think they do. “Sometimes people don’t want to hear the truth because they don’t want their illusions destroyed.”― Friedrich Nietzsche. Surely, if you are delegating to others to outperform, its vital to know the truth, isn’t it?
The Wealth Coach, an independent financial advisory firm based in the UK. Nic Round, Chartered Wealth Manager.
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