Do you need a financial advisor?
Americans today want help in planning a successful financial outcome. But while there’s no shortage of advice— conferences, seminars, books, and, yes, financial columns in the media — there’s a general frustration about how to turn that advice into action. There’s also a feeling of uncertainty.
Many people think the only value a financial advisor should provide is on a portfolio’s rate of return. That is important, but it’s only one of the ways we add value. A good advisor should also focus on reducing your taxes where possible, providing clarity on progress toward your goals and, most of all, work to protect your assets by adding strategies intended to manage risk. All this as the advisor builds and regularly tests a customized financial plan.
In addition, a good advisor should be able to provide other more personal services such as financial guidance during times of personal transition – the loss of a loved one, retirement, or a period of caring for aging parents.
If we do these things, our value should be to help increase your standard of living by avoiding costly mistakes. Portfolio rate of return is an important part of that, but to get it right you have to make good decisions in the other areas of your financial life.
So I would ask you this – what value are you getting from your financial advisor? Is it just an investment return?