Once upon a time everyone called their “money guy” (or gal) a stock broker. Over the years, a lot has changed in nomenclature. Nowadays not only are there stock brokers, but there are financial consultants, investment advisers, wealth managers, etc.

Money guys & gals have gotten pretty creative in re-branding themselves. The re-branding effort, like any re-branding effort in any industry, was intended to gain more business. Somewhere along the line the term “stock broker” got dirty and the term “wealth manager” got glamorous.

It has been said that a rose by any other name would smell just as sweet. Well, the converse of that statement is true. If your stock broker (or consultant, or adviser, or manager, or whatever) is a bad stock broker, accepting that fact may be a bitter pill to swallow. But fancy title or no, you need to take charge and fire your bad stock broker.

You should fire your stock broker today. For that matter, don’t just fire the broker, but fire the team and fire the firm. Move on. We are having a conversation about your life savings – your livelihood. If you weren’t happy with your service at a restaurant you may very well never go back. And that’s just one bad meal. If someone disturbs your family’s entire life in doing a disservice by way of your nest egg, then you should be even more so discriminating.

Here’s a dirty little industry secret - most stock brokers could not predict the direction of the stock market (much less a specific stock) if their life depended on it. Sales is a respectable profession, but unfortunately for most investors, their stock brokers are nothing more than a glorified salesman with a new, fancy title.

So how do you know when to fire your stock broker?

If your so-called advisor rode the stock market down 30-, 40-, or even 50% then fire your broker today! If over the last couple years your broker said things to you like “this correction doesn’t matter, we are in the market for the long-term” or “don’t worry, the stock market will come back” or “it’s safe, we own blue-chip companies” or anything else to the affect that it is wise and/or prudent to stick your head in the sand while the stock market is crashing, then fire your broker today.

If your portfolio is roughly the same value as it was a decade ago, then fire your broker today! The allure of the stock market is that while risky and volatile, there is the alleged promise of big returns for those with the fortitude to stay in the stock market for the “long-term”. Well, ten years is long-term. If your manager has barely made you any money over that period (whilst he or she has been collecting fees and/or commissions from you for ten long years of nothing) then fire your broker today.

If your broker works for a firm that is in such trouble that it is closing offices or needs a government bailout, then fire your broker today! If this is the case, then there is a good possibility that your broker is spending more time worrying about their next payday or where they are going to go once their offices get closed out or bought out. There is nothing wrong with change, but in this economic and market environment don’t you want an investment adviser that is fully focused on the management of your portfolio?

If your broker works for a trust or “wealth management” division of a bank or credit union, then fire you broker today! If this is includes you, then it is probably a safe bet that your portfolio was down thirty or forty percent last year. Do you really want to pay for that type of “safe” investment?

If your broker tries to sell you an annuity for your IRA, then fire your broker today! This is not yet criminal, but it should be. Insurance is a wonderful thing, but this is the playground of a lot of insurance brokers looking to lock in a hefty 7.5% commission for themselves as they sing you a pretty song about the “safety” of annuities.

If your broker did not call you personally during the last half of 2008, then fire your broker today! If ever there was a time for an adviser to reach out to a client and explain what was going on, then it was last year. If your broker did not call you, then they either don’t care about you or they just didn’t understand what was going on. Neither is acceptable.

Second opinions?

What if you still aren’t sure if you should fire your broker? Well, are your life savings as serious as, say, a shoulder injury? Let’s say that you had a doctor’s recommendation about undergoing surgery for a rotator cuff injury. It may be the right thing to do, but you are still going to get a second opinion. Shoulder surgeries are no laughing matter, but your family’s life savings is on an entirely different level when it comes to your standard of living. As such, if your portfolio was down twenty percent last year then it is prudent to get a second opinion. It is important to reach out to another adviser – outside of your broker’s firm – and ask for a complimentary review of your portfolio.

What’s next after you fire your broker?

If you go through the process of getting that aforementioned second opinion, then “what’s next” may be part of that review. But in short, meet with another potential adviser and ask them what they might buy, hold, or sell for you and your family’s portfolio and have that adviser explain why it is appropriate for you.

Don’t rely on the adviser’s list of references. You are only going to get a list of the adviser’s friends (nobody ever gives a bad reference). When you go on vacation you spend time researching where you are going to go and what you are going to do. It seems at least appropriate to spend some time with a potential new adviser discussing how that person may do things differently than your current stock broker.

Special Bonus Advice:

It is not O.K. for you or for your family to do business with a stock broker just because he’s a “nice guy” or because you occasionally play golf with her. Getting you to and through retirement is not personal; it is not social – it’s business. Very serious business. It should be treated as such at all times.