AUGUST 10, 2022
By Kristen Mayne

Watch time: 2 minutes

Should you consolidate your investments?

Consolidating your investments doesn’t mean investing in only one product. It means taking the investments you have with different financial institutions and putting them in one place.

In fact, “Consolidating your investments can help you manage your money more efficiently,” says Sun Life Certified Financial Planner Jeffrey Wu.

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Wu shares 5 benefits of consolidating your assets with one advisor or one group of advisors:

1. A more holistic and easy-to-understand plan

When you work with one advisor, they have greater insight into your full financial picture, says Wu. “This can help them offer a strategy that will get all your assets working together towards your goals. One single plan ensures you don’t have multiple strategies that aren’t working together.”

“It can be hard enough to follow a single plan. It’s even harder to follow multiple plans,” says Wu. “Consolidating your investments gives you and your advisor a clearer picture of how your savings are performing.”

It can also be difficult to form saving habits when you’re working with multiple advisors. An advisor is there to help Clients develop these habits. They can also provide coaching when the market is volatile. It can be confusing when you’re getting different advice from multiple advisors or when you’re having to share your concerns with multiple people.

2. Saves you time and simplifies your life

It can take time to create a good financial plan that accounts for all of the unique aspects of your life. When you work with one trusted advisor you only have to create one plan versus multiple plans. “This also means you have one login and one monthly statement. And you can access all your financial information on one online platform,” Says Wu.

And if your circumstances change? It’s easier to review and update your plans with one advisor than multiple advisors. And you don’t have to repeat yourself.

A Sun Life advisor can help you address your changing needs by looking at the big picture, says Wu. “The best plans change with your needs and goals.” However, you may lose visibility and flexibility to adjust your course if you invest across multiple platforms.

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3. Saves you money on fees

Investing through multiple advisors may cause you to pay more fees. Generally, the more assets you have with one advisor, the more opportunities you have for reducing fees.

Wu shares an example:

  • Let’s say you have $500,000 in investible assets with three advisors. The average fee per year for the advisors is 1%. You would pay $5,000 per year in fees.
  • Usually fee-based advisors charge a fee based on assets under management with the advisor. By consolidating money with one advisor, you may be able to negotiate the fee.
  • Let’s assume the negotiated fee is 0.8% for the $500,000 in assets. You could save $1,000 per year just on advisory fees. This can have a big impact on the portfolio over time due to compounding.

4. More effective risk management

Understanding the risk characteristics of investment products can help you choose investments that match:

  • your risk tolerance,
  • your financial goals, and
  • your investment timeline.

“If your investments are with multiple advisors, managing your risk can be difficult. And what you’re invested in may not match up with your risk profile,” says Wu.

5. Long-term support in unison with your values and objectives

Do you want your investment strategy to be consistent with what you believe in? Working with one advisor may help you.

Getting to know Clients is more than completing a checklist or an investment assessment. It’s about getting to know you and what’s significant to you. Likewise, it’s important that you team up with an advisor that you trust and that you feel confident in.

“We have many Clients who have strong views on the environmental and social aspects of what they are investing in. We make sure all the funds we choose meet their financial goals and fit their values,” says Wu

It’s important to work with an advisor or advisory team that have a range of tools in their toolbox. This will ensure you get more comprehensive and tailored solutions. Many Sun Life advisors are licensed in insurance, mutual funds and/or are designed as financial planners.

Need help with your savings and investments? Consider working with an advisor.

 

Don’t have an advisor? Find an advisor near you.

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This article is meant to provide general information only. Sun Life Assurance Company of Canada does not provide legal, accounting, taxation, or other professional advice. Please seek advice from a qualified professional, including a thorough examination of your specific legal, accounting and tax situation.