Are You Getting Too Much Good Advice?

By Kendra Reilly, CFP®, CIMA®, CEPA®

There’s a financial professional for everything you can imagine: retirement, taxes, insurance, real estate, investments, estate planning, and more. But with so many different facets of your financial life and numerous professionals to turn to, it can be easy to find yourself overwhelmed with too much good advice. 

While each professional may have years of experience and impressive designations, their good advice can only go so far if they’re not working together toward a common goal. Here’s how too much good advice can actually be a bad thing, and what you should do instead.

Your Finances Don’t Exist in a Bubble

Every decision you make and every milestone you reach impacts your financial situation. Even within your finances, there are multiple pieces that affect one another. Seemingly simple tasks like opening a retirement account has implications for other aspects of your finances when you start to consider variables like the investment options, income tax effects, withdrawal strategies, and estate-planning considerations.

Because of that, choosing to pursue one financial goal can have a drastic impact on the others. That’s why it’s crucial to make sure the professionals you hire to manage individual aspects of your finances work together as a team.

Siloed Conversations Lead to Missed Opportunities

Siloed conversations with different professionals (attorneys, CPAs, insurance brokers) can quickly lead to missed opportunities and decisions that don’t maximize your overall financial picture. 

For instance, your CPA can tell you how to reduce tax liability, but is that the best long-term decision for you? Sometimes it may actually be better to pay higher taxes in exchange for something else. 

Roth conversions are a great example. You may pay a hefty tax bill up front, but you’ll receive future tax-free growth in exchange. Depending on your specific circumstances, this could provide a much greater benefit over time than reducing your tax liability in one year.

Too Much Good Advice Can Be Time-Consuming

Managing the relationships between multiple financial professionals can be time-consuming and overwhelming. Each one requires their own discovery process, ongoing documentation, meetings, emails, and phone calls. 

Then you need to translate the message from one professional to another. By the time it’s all said and done, chances are something was lost in translation—or simply not translated at all. Things can fall through the cracks, especially if your finances are more complex.

A Financial “Chief of Staff”

It’s not uncommon for people to think that hiring independent professionals for every aspect of their financial life is enough to make the most of their finances. But more isn’t always better, and siloed professionals can actually lead to significant gaps in your overall financial plan. Instead, there should be one point of contact, a financial “chief of staff”, who is managing and executing the plan on your behalf. This can help ensure your finances are managed in a holistic manner and your hard-earned legacy is maximized for generations to come.

So now the question is, who should you get to manage the conversations with the other members of your financial team? Ideally, the role should be filled by someone who understands your financial life and communicates well with you, your spouse, and other family members. 

Generally, Certified Financial Planners can be a great fit for this role since they understand investing, insurance, estate planning, and tax implications. A Certified Financial Planner shouldn’t replace the CPA, estate planning attorney, or other advisors, but, rather, facilitate communication. If done properly, this can also greatly increase the success of your financial plan as your legacy is passed down. When each financial professional is on the same page, working together with a full understanding of your long-term plan, you greatly reduce the risk of costly mistakes and missed opportunities.  

Take the Next Step

If you’re currently in the middle of a web of conversations between financial professionals, our goal is to take over and quarterback the financial team. At Interchange Capital Partners, we have the tools and expertise to navigate these relationships and help you make the most of your finances. Don’t let too much good advice derail your plan; work with a financial “chief of staff” instead.

Email us at team@interchangecp.com or call our office at 412-307-4230 to schedule an introductory appointment.

About Kendra

Kendra Reilly graduated Cum Laude from the University of Pittsburgh with a double major in communications and English writing. She completed the Executive Certificate in Financial Planning program through Duquesne University and successfully earned her CERTIFIED FINANCIAL PLANNER™ designation, Certified Investment Management Analyst® (CIMA®) credential, and Certified Exit Planning Advisor (CEPA) credential. In her free time, Kendra enjoys traveling, cooking with her husband, and baking and decorating cakes. You can often find her hiking with her dogs or spending time with her husband and son Benjamin. She has been involved with Big Brothers Big Sisters of America (BBBS) for many years and is a member of the Young Professionals Advisory Committee for the Pittsburgh Foundation. To learn more about Kendra, connect with her on LinkedIn.

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