How to Evaluate and Select Professional Advisors
Selecting and evaluating professional advisors is always difficult because clients generally start off at a significant knowledge disadvantage. I hope that this book reduces your knowledge disadvantage, as that was my intent in writing it. After reading this, you may find yourself knowing as much (or more) about the workings of your buy-sell agreement as your professional advisor, which is as it should be, in my opinion.
Too often, professional advisors are placed in the difficult position of deciding significant matters for their clients, either because the client lacks the knowledge to make an informed decision or wants the advisor to make the decision for him or her. Of the latter of these reasons, I always tried to avoid that by not permitting clients to abdicate important decisions about their lives and the lives of their loved ones or business partners to me if I could help it.
So, your next question is likely to be, “Well, Paul, how do you select and evaluate professional advisors?” That is an excellent question. I have a lot of personal experience as I have been a client of several other professional advisors. For starters, I tend to select professional advisors based not on what they tell me, but on what they ask me. In my opinion, good pointed and piercing questions usually demonstrate significant knowledge—much more so than a professional advisor who does all of the talking, trying to demonstrate his or her knowledge of the subject matter of your particular problem.
I also evaluate a professional advisor on their ability to listen to what I am saying, in contrast to rehearsing a rote reply in their head while I talk. Professional advisors who listen before talking always make me feel validated. The ones who launch into a “solution” before really listening to me and the problem are a waste of my time.
With respect to selecting professional advisors, I often base my decisions on word-of-mouth experiences from actual clients or persons familiar with those who were happy with their advisor. However, this is not always possible. So, how would you find a professional advisor who knows the ins and outs of buy-sell agreements? I was a practicing lawyer, so that’s the profession that I know best, although I’ve indeed hired professional advisors other than lawyers. Generally, the lawyers who tend to know the most about buy-sell agreements are tax lawyers, estate planning lawyers, or corporate lawyers. This is where I would start.
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