Dale Jackson

Personal Finance Columnist, Payback Time

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Finding a good advisor who can guide you to your investment goals over several years isn’t easy. So, what do you do when that advisor changes firms and wants you to follow? It’s like your favourite player getting traded to another team. Do you follow the player, or stay with the team?

Here are some questions you should be asking yourself and your advisor:

Is it the advisor you like or the firm?

A split between advisors and firms can be like a divorce, and you’re caught in the middle. On one side the advisor wants your business, and on the other side, the firm wants you to stay with them. If you decide you like the firm, they will probably recommend another advisor.       

Will your current investment strategy be affected?

Does the new firm have a certain investment strategy your advisor will have to adopt? How does it impact your long-term goals and the amount of risk you’re willing to assume?

Will your advisor be servicing more clients?

If your advisor is assuming a new client list and maintaining the current list, there could be less time for individual attention with you. Also, if the new client list includes higher net worth clients, you could be getting the leftovers.  

Does the new firm have the same services?

Those brilliant investment ideas your advisor brought up over the years may have been coming from a team of researchers with expertise in each area of your portfolio. Does the new firm have a solid research department? Does the new firm offer online tools to do your own research or track your investments? Does it provide estate and tax planning services?

Does the new firm offer a wide selection of investment products?

Some firms only offer investment products from certain providers. Will you be bound by a narrower selection of investments? How good are those products?

Will you be forced to sell existing investments?

If that firm does not offer the products in your portfolio will you have to sell them at a loss or incur a capital gains tax if you sell high?

Will there be additional fees?

If you need to sell, transfer, or set up a new account there may be fees like closing costs and transfer fees.

Is the fee structure changing?

Different firms have different fee structures. Could the new firm be charging you more or limiting your options through higher fees?

Dale Jackson is BNN's Personal Investor. Follow him on Twitter @DaleJacksonPI