Your decision may not need to be limited to those two opposite extremes. But given the two, you should definitely choose an independent adviser--that is, if they are a fiduciary and have their own Registered Investment Adviser (RIA) firm (or work for an independent RIA). Why? The independent adviser works for you (assuming a fee-only fiduciary arrangement where you pay the adviser directly). Their loyalty is to you as the client. Typically, an independent adviser can work with you according to your needs, has access to a universe of financial vehicles, and is not limited to a list of "approved products." By way of contrast, an adviser with a large bank wealth management division works for the bank. Even if you think they're a great person, their loyalty must be to their employer. The (sometimes ridiculous) strictures of bank compliance, "approved product" lists, and bank culture will necessarily limit how the adviser serves you. And you can be certain that any financial products a bank's wealth management division has approved are going to be those that heavily benefit the bank. Depending on your needs, an alternative to these two extremes might be to consider a small independent advisory firm with a few advisers. Disclosure: I'm a solo financial planner and portfolio manager with my own Registered Investment Adviser firm (SecondHalf Planning & Investment,
LLC), so that’s the bias I'm reflecting here. Hope that helps. Larry
Larry gave you an excellent response to your question. I'll add some additional thoughts.Unless you are part of the Forbes 500 wealthiest Americans, you will probably get lost in most bank trust departments. The bank, Larry and I as fiduciaries all have the same responsibility to you as an investor. We will all charge you a management fee based on the amount of assets you give us and put your interests ahead of anything else when making investment decisions on your behalf. But your $5,000,000.00 account with Larry or me is going to get a lot more attention than a $5,000,000.00 account in a $200,000,000 + bank trust department. I'm also fairly certain we will know more about your personal situation than a trust department officer.The majority of Registered Investment Advisors are small business owners and proprietors. We don't lock the doors and go home at 6 PM. If the Asian markets implode over night, it won't take a committee meeting tomorrow morning to address the problem. And I'll wager we'll be in touch with you well in advance of your Relationship Manager at the bank to tell you if and how you've been impacted.Regarding your personal net worth, would you rather work with someone who is compensated based on how well you do, or with someone who is on salary and gets paid whether you do well or not?You may not be comfortable with a one man RIA. I can understand that. But the concept of independentdent advisory relationship with a small multiple member staff might align you with what you are trying to accomplish.Hope I've added some value here.
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