Why Choose a Sacramento Financial Planner over a Large National Firm?
When looking for a financial advisor in Sacramento, CA, residents have options ranging from an independent Sacramento financial planner to one of the national (or even multinational) financial services companies.
While the choice is personal, many people benefit from choosing a local financial planner. You may find that an independent, community-based financial advisor will yield more individualized service and a greater alignment of interests compared with larger firms.
Specifically, an independent financial advisory firm in Sacramento might offer advantages in terms of:
Fee Structure
In many cases, independent firms operate as fee-only advisors, meaning they earn income from their clients. In contrast, large national firms may be commission-based. Or they may be fee-based, meaning the professional that you work with can still earn commissions for selling you certain products.
As a fee-only financial planning firm serving the Sacramento area, we believe that fee-only advisors have an incentive to align their interests with yours. That’s because their income is based on helping you grow your wealth rather than selling you certain products.
It is important to ask a prospective financial advisor how they are paid. In addition to finding out about the fee structure, talk to a prospective firm about how specifically you will be charged, such as a set fee or based on a percentage of the assets they manage for you.
Personalized, Fiduciary Service
While you are talking to a prospective advisor, ask about their fiduciary obligation to you. A Registered Investment Advisor (RIA), for example, has a fiduciary obligation and must put your best interest first.
You may also appreciate the personalized service you are likely to receive with an independent RIA. The team members at small firms often have more time to dedicate to each client. For example, our Roseville-based financial planning firm strives to know each client on a personal level, and our services are tailored to clients’ specific goals.
Even if an advisor at a large national firm operates with your best interest in mind, the relationship can still be more transactional than the personal service you may receive with an independent RIA.
Plus, if the large national company offers its own investment products, you might receive limited recommendations. The professional you work with may be motivated to steer you toward investing in the company’s products.
Without being tied to the goals of a larger organization, an independent advisor can generally customize your financial plan or investment portfolio. Depending on the firm’s expertise and service offerings, they can dive into areas such as tax planning, review of employee benefits and compensation, and other niche areas that large national firms might not look into.
Local Expertise
Another reason to choose an independent financial planner in Sacramento is that the advisor may have more local expertise than a representative at a company with national reach. Even if the national firm has branches, they may rely on national models from the corporate office, rather than customizing to fit regional circumstances.
Having local expertise can pay off in numerous ways, such as understanding local and state taxes and how those affect long-term financial planning. The area firm should also be attuned to local economic conditions and understand how these regional differences can affect everything from cash flow planning to retirement planning.
A local advisor does not need to follow the guidelines of a large company. They often know other professionals in the community and can direct you to trusted professionals, such as estate planning attorneys and accountants.
Consider Your Options
While large national companies may have advertising budgets that make them seem appealing at first glance, you may find that a Sacramento-area, independent financial planner is a better fit.
As an independent financial planner serving the greater Sacramento community for over three decades, we generally tell people to consider their options carefully, including the level of personalized service, fee structure, and fiduciary obligation to put the client’s best interest first.
Schedule a complimentary, 15-minute call with a fee-only financial advisor today to discuss your personal situation.
This material was prepared by Kaleido Inc. from information derived from sources believed to be accurate. This information should not be construed as investment, tax or legal advice.
Parkshore Wealth Management is a family-owned, independent, fee-only Registered Investment Advisor serving the greater Sacramento area with an office in Roseville, CA. We partner with financially responsible individuals and families who are eager to take positive steps that will allow them to use their money to build the life they desire. The firm is led by Harold Anderson, CFP®, and Daniel Andersen, CFP®, both members of NAPFA, the country's leading professional association of fee-only financial advisors.