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FAQ Content
Do I need a financial advisor?
How are the financial advisors chosen?
How can I recommend my financial advisor for the ValuesAdvisor platform?
Will my contact information remain safe if I sign up?
Where can I learn more about Values Aligned investing?
I have a different question. Who can I email?
What is a financial advisor?
Financial Advisors are professionals you hire to determine how to invest your "investable assets" (a term that encompasses your cash, money market accounts, stocks, bonds, mutual funds, retirement accounts, and trusts), to help you reach your long and short-term financial goals. The advisors on the ValuesAdvisor platform also have an expertise in aligning your investments with your values. For example, if you're concerned about climate change, they can ensure that your investments aren't further contributing to the problem, or investing in companies that help find solutions.
Do I need a financial advisor?
Typically, you need approximately $250,000 in investable assets to make it cost effective to hire an advisor. While there are some advisors on the ValuesAdvisor platform who don't have a minimum account size, it can be cost prohibitive to hire an advisor if you have less than $250k. Many investment advisors require a minimum account size to work with you, generally ranging from $100k to $5 million, although there are several advisors on the ValuesAdvisor platform who have no minimum account size.
In addition to investable assets totals, you may want to consult with a financial advisor if:
- You're experiencing a major life event such as marriage or divorce, having kids, or new investable assets via an inheritance or a liquidity event (meaning, you sudden acquire a large influx of investable assets).
- You need specific advice on retirement planning, charitable giving (DAFs), or tax strategies.
- You have specific questions about assets in a particular asset class (i.e. stocks, bonds, private equities, etc.).
- You're feeling very anxious about your finances and would benefit from being able to speak to someone who knows you and your financial picture.
Cost of hiring an advisor
Advisor fees are usually charged as a percent of your assets under their management (AUM). Percentage fees tend to be deducted directly from your account and are often on a sliding scale: The higher the investment, the lower the fee. An advisor might charge 1.25% to manage assets of $500,000 or less, then drop to 1.0% for assets of $501,000 or more, dropping again to 0.090% after the first million invested, and so on. They can also charge a flat fee (by the hour). Because each person's financial situation is different, you need to specifically ask each advisor explicitly about the exact fees for your accounts.
Importance of the Fiduciary Standard
When you hire an investment advisor, make sure they work for a registered investment advisor (RIA), which requires them to operate under the "fiduciary standard" (meaning they are legally required to put your financial interests ahead of their own or their firm's). The US based advisors on the ValuesAdvisor platform are RIAs. You can learn more about the differnece between a "fiduciary standard" verses a "suitability standard" here.
What are my options if I don't have enough investable assets to work with an advisor?
Robo-advisors are automated, digital investing services that, with almost no human interaction, collect information about you and your financial goals, and then invest your investment capital automatically based on your answers. They are regarded by the SEC as the same as traditional advisors, and so must comply with the same laws. Robo-advisors offer lower annual costs than financial advisors. Most robo-advisors charge an annual flat fee of 0.2% to 0.5% of a client's total account balance (versus a typical rate of 1% to 2% charged by a traditional financial planner), as well as have lower minimum account size than traditional advisors. On average, robo-advisors require a minimum of $5,000 to open an account, significantly less than traditional advisors who require, on average, a minimum account size of $100,000.
ValuesAdvisor does not include robo-advisors on their platform, but below are a few values aligned roboadvisors (please do your own research on each).
Earthfolio - Founded in 2000, it was the first automated investing service dedicated to impact investing. Their minimum investment is $25,000 and invest in mutual funds.
Newday Investing - A Certified B Corporation, it offers a suite of options for you to reflect your values in your investment portfolio. They have portfolios with themes of global impact, stakeholder capitalism, diversity & inclusion, climate action, sustainable agriculture, animal welfare, freshwater, and ocean health. Their fees are 0.75% and donate 5% of their revenue to their NGO partners.
Ellevest - An investment platform that is focused on serving women, their algorithm accounts for women’s longer life expectancy, earlier peak annual earnings, and increased time out of the workforce.
Betterment -Their approach is to use low cost ETFs. They offer impact investment options in two asset classes - US large-cap stocks and emerging markets.
What is ValuesAdvisor?
ValuesAdvisor is nonprofit, online database of financial advisors who have been recommended by the members of our partners, individual investors, foundations and institutional investors. We were created by Lisa Renstrom, a former President of the Sierra Club, impact investors and philanthropist, who saw the need for a unbiased, non "pay to play" database of financial advisors who specialize in values aligned investing. You can learn more about our team on the ValuesAdvisor website. We are fiscally sponsored by RSF Social Finance.
What is the criteria for a financial advisor to join ValuesAdvisor?
To be invited to join the platform, a Financial Advisor must:
- Be recommended by at least one member of a ValuesAdvisor Partner organization or an expert in the impact investing field.
- Offer impact-based financial advisory services as a core business (demonstrated by approximately 25% or more of current AUM of Advisor/team and highlighted on the Advisor’s website).
- Demonstrate significant knowledge of the impact investing field (offering values aligned investment options for a minimum of three years and/or expertise as determined by ValuesAdvisor).
How can I recommend my Financial Advisor?
If your Financial Advisor has helped you align your investments with your values, and you think your peers will benefit from using them, we would love you to recommend them HERE.
We welcome all suggestions, including someone already on the platform. Any advisor suggestions will remain confidential. The name of your group will be displayed on the advisor's profile - not your individual name.
Will my contact information remain safe if I sign up?
ValuesAdvisor is a nonprofit that was designed by investors, for investors. For this reason, we are totally committed to protecting the animosity of our investor users. No data about you is ever shared with financial advisors, or anyone outside of the organization.
Where can I learn more about values aligned investing?
The ValuesAdvisor resource page on its website has a helpful educational resources to learn more about the this type of investing.
Our Co-Founder, Kate Simpson, has also created an online course that includes many resources to learn about the values aligned investing field.
I have another question.
For additional questions, please email: info@valuesadvisor.com
