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A lot of people will question why you’d hire someone to do something you can do yourself. Why is hiring a financial advisor worth it?
If you look at online websites, you’ll see people question why you’d hire someone to manage your investments. There are tools to be able to do it yourself. Surely it’s best to save the money you’d pay in fees when hiring a financial advisor and do it all yourself.
Well, if you’re financially savvy, I’d say go for it. There’s nothing wrong with using the likes of WealthSimply and Questrade and all the other tools out there. However, there are reasons why a lot of others will choose to hire someone to do it. Hiring someone could be right for you. Here’s why you need to do it.
Financial Advisors have been through training
Financial advisors go through a lot of training to get their license to do investments. On top of that, they need to continue education to keep their licenses. They’ll understand the details of different mutual funds available, they’ll know all the sources of passive income or be able to help you make the best investment decisions.
There are some unscrupulous advisors out there. Some are more interested in making money than doing the best thing for their clients. However, not everyone is like that. Some advisors will always check in to make sure you have the right investment plan and to see how things change year after year.
You haven’t been through the training. You may not know where to even start. Sure, you can read a few books* or check out training videos online, but are they going to motivate you or make you feel comfortable in making investment decisions?
You may have sudden life changes
So, you’ve got the advice you need for right now. You’re feeling more confident in making investment decisions, so you want to go out on your own. That’s great, but you may want to look at hiring a financial advisor in the future. You may even want to consider keeping your advisor.
There are all sorts of life changes. Divorce, retirement, empty nesting, pregnancy, marriage. These are all just some of the things that can happy in your life. There are a lot more life changes, even just losing your job can be a huge change that leaves you panicking.
If you have a life change, you’ll want to talk to someone who is educated in handling them. Rather than make some emotional decisions with the life changes, you can have someone help you make better decisions.
Hiring a financial advisor to make a one-off decision
You may not need to hire someone for the long term. You could hire a financial advisor coach for a one-off decision. This is great if you have a sudden inheritance or a buyout.
You may be new to money and have no idea what to do with sudden changes. A financial advisor will be able to help you make the decisions, and there are many who will charge for the hour or for the service. Some will even just offer some free advice as a one-off with the hope that you’ll become a client in the future. You can look at here and let a financial advisor guide you on how to set yourself up for retirement.
The last thing you want is to think you have investments and make a decision with a large amount of money. You’ll end up potentially making a huge mistake because you just don’t understand things.
You may not have the confidence yet
There’s nothing wrong with saying you don’t have confidence in your finances. Some people just don’t have any interest in learning. Why learn when you can hire someone to do it for you? Others may have poor financial skills and just want to keep their money out of their own hands.
If this is you, a Personal Financial Planning Consultation will be able to help you. There is someone who will at least make sure you start investing. You can find someone who can help with budgeting.
Paying someone to make investment decisions for you is better than not making any investment decisions at all. It’s okay to admit that this is just right for you. Ignore what the “well, you could do it yourself” people say.
An idea of what’s to come
Nobody can say what’s going to happen with the stock markets. We knew there would be a downturn after the pandemic, but we weren’t expecting to see a war that would change more. Prices have gone up, interest rates are up to try to deal with inflation, and it’s all having a knock-on effect with the markets.
You’ll want to blame your financial advisor, but it doesn’t matter where you go right now. Even doing it yourself, you’ll see things take a downturn. The best thing about hiring a financial advisor is they’ll have a few insights into the markets that you won’t on your own—unless you will spend your time doing a lot of research. Financial advisors often talk to those who create mutual funds, who have a lot more experience with the markets and will be able to help predict the market a little better.
Where are you in your financial literacy journey? Are you ready to hire an advisor? Share your thoughts in the comments below.
If you’re looking at hiring a financial advisor, get in touch today to see how I can help.