Should you have more than one financial advisor?
Different financial advisors can offer expertise in different areas. You may need more than one to meet your needs.
Summary
Financial advisors can provide valuable guidance on retirement, investments, insurance, taxes, estate planning, and other topics.
You may encounter conflicting advice and additional fees if you hire more than one financial advisor.
Establish a clear plan for how you want your financial advisors to work together.
Unbiased can match you with a financial advisor with the expertise needed for your unique situation.
Can you have more than one financial advisor?
Yes, you can have more than one financial advisor.
Your current financial advisor may discourage it, but you might also find another expert to help you meet your financial goals. Some types of expertise a financial advisor may have include the following:
Investment advisor: An advisor who focuses on investment decisions for clients. They may be a registered investment advisor with the SEC.
Inheritance or estate planning: An advisor who specializes in finances for estate planning and inheritances.
Insurance: An advisor who knows the ins and outs of insurance needs. Often an insurance agent.
Financial planning: An advisor who takes a comprehensive look at your finances, identifies goals, and creates a roadmap to reach those goals.
Tax planning: An advisor who specializes in tax-efficient strategies.
Robo-advisor: A robo-advisor automates investments based on your age and financial situation using algorithms created by the provider.
Small business: An advisor who specializes in serving the unique needs of small business owners.
If you need ongoing financial planning in multiple areas, you may want to have more than one financial advisor.
What are the pros and cons of having multiple financial advisors?
Having multiple financial advisors comes with some pros and cons. We’ve broken these down to help you decide whether or not you should add another financial advisor to your team.
Pros of having multiple advisors
Add expertise: You’ll put yourself in a better position and be less likely to make mistakes when you add an advisor with deep knowledge in a particular area.
Add a new perspective: A second advisor can give you a second opinion on the financial decisions you’re making. You might also see how the two advisors compare in terms of costs and services.
Could reduce conflicts of interest: Having multiple advisors reduces your reliance on one, which could help reduce conflicts of interest you may see at a single firm.
Cons of having multiple advisors
Miscommunication: Adding a financial advisor should clarify an area of your finances, but it’s possible that it can create confusion or duplicate services.
More fees: Adding another financial advisor to the mix means another person or firm needs to be paid.
Conflicting advice: If you have multiple financial advisors, you’ll likely receive contradictory advice, which can make it difficult to discern the correct path for you.
Less accountability: When multiple financial advisors are involved, there could be less accountability for a complete financial plan.
How to manage multiple financial advisors
There are several ways to hire another financial advisor.
Option 1: Appoint a lead financial advisor. One strategy for managing multiple financial advisors is to set up a hierarchical structure where one advisor is the lead. The lead advisor will coordinate the others.
Option 2: Give each financial advisor a role. For example, you might have one for tax optimization, one for retirement and estate planning, and another for investments. Communicate clearly what each advisor's role is to eliminate overlap.
Option 3: Divide your assets between advisors. If you want to spread your assets among different advisors, it is possible, though neither advisor will like it, and you might see a more inconsistent financial plan. Be aware that financial advisor fees are usually lower when you have higher assets with one firm. You’ll also want to make sure both firms are following through with your financial plan.
Should you have multiple financial advisors?
Deciding to hire another financial advisor comes down to your financial goals. If another financial advisor can help you meet those goals, you’ll want to consider hiring more than one.
Your current advisor may recommend another advisor for more specialized financial planning. It may be more detailed tax planning or specialized planning for a disabled child. You’ll naturally want to find someone with more knowledge and resources to help you.
To hire one, you may want to ask prospective financial advisors these questions.
Get expert financial advice
Utilizing the expertise of multiple financial advisors is a smart way to manage your finances. You’ll want experts in their respective fields to be well-versed in taxes, retirement, estate planning, or any other financial situation you have. However, if the different advisors aren’t on the same page, it can create confusion and pull you further away from your financial goals.
Unbiased has a roster of financial advisors who specialize in different areas of personal finance. If you’re looking for a good advisor, Unbiased can quickly match you to one who meets your needs.
Content Writer
Alene Laney is an award-winning journalist for Unbiased, where she breaks down financial topics related to retirement, investing, and banking. She specializes in helping readers make the best decisions for their money with long-form content for brands and consumer publications.