Here are the top 3 reasons to fire a financial advisor, say experts

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Breakups are always hard.

The relationship with your financial advisor is no different. But there are some telltale signs it's probably time to call it quits, experts say.

«When it comes down to it, it's a business relationship,» said Micah Hauptman, director of investor protection at the Consumer Federation of America, an advocacy group.

«If advisors are not serving the client in a way the client deserves or expects, it's entirely appropriate to end the relationship,» he said.

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Statistics vary on how many people use a financial advisor.

About 17% manage their money with the help of an advisor, according to one 2019 CNBC survey. A poll conducted last year by Northwestern Mutual found that the share jumped during the Covid pandemic, to 35%.

But only 6% of clients ever fire an advisor — which suggests doing so is a «relatively rare occurrence,» according to a new Morningstar study.

Here are three situations when it may make sense to part ways.

Most investors who fired their advisor cite poor quality of financial advice and services or poor quality of relationship as primary drivers of their breakup, according to Morningstar.

Indeed, 53% of individuals said these reasons accounted for their decision.  

In other words, it's largely not lackluster financial returns that people care about, said Danielle Labotka, a behavioral scientist at Morningstar and a co-author of the report.

Instead, issues might arise if an advisor doesn't devote enough time to understanding who their client is as a person or their personal financial needs