The Advisor - Client Partnership

THE ADVISOR - CLIENT PARTNERSHIP

An important partnership exists between a client and his or her advisor. To help clarify this relationship and avoid misunderstandings, the roles of both the advisor and the client are laid out below.

Advisor Responsibility

• Knowing the client’s financial needs, goals, and changing situation
• Maintaining confidentiality—keeping all information pertaining to the client’s finances private
• Constructing an asset allocation strategy to match the client’s objectives
• Selecting specific securities for the client’s portfolio
• Frequently communicating with the client through monthly and quarterly reports, as well as through meetings
• Rebalancing the client’s assets over time
• Reallocating the client’s assets as circumstances change

Joint Responsibility

• Determining the investment objectives—developing a mutual understanding as to the client’s risk tolerance and anticipated returns
• Determining product selection—agreeing on the types of investments (mutual funds, stocks, annuities, etc.) that will be incorporated into the client’s portfolio
• Monitoring performance
• Determining taxable consequences—the client must inform the advisor of his or her tax situation so that the client and the advisor can build a tax-efficient portfolio

Client Responsibility

• Providing the advisor with all financially relevant information
• Establishing financial goals
• Notifying the advisor of liquidity needs and expected cash flow
• Informing the advisor of any change in objectives and financial situation
• Trusting the advisor’s expertise