The Value of a Financial Adviser
For a long time after growing up I was under the impression that financial advisers were for the rich. Probably a lot of middle income families who don’t have much to invest figure that they are better off doing it on their own instead of wasting money paying someone else to do it. However, there is a lot of value in having a financial adviser no matter what the amount of money you are talking about investing is.
A financial adviser can offer a neutral third party point of view on your money and where it should be invested. An adviser helps you evaluate where you are at in life, how much risk you can take and help you make a plan. You are still in control of your money and making the decisions, you just have an expert giving you advice.
With the economy the last few years and many investments doing so poorly, people start to panic and even those who were using a financial adviser pull their money out of fear. Bank of America’s Merrill Lynch and Morgan Stanley Smith Barney, which represent the top two full-service brokerages, had combined amounts of about $150 billion pulled out during 2009. This is done out of fear during times the economy is doing poorly. For some, on the verge of retirement, they needed to protect their money as best they could and move it to safer areas but for the younger generations who can afford to ride out a bad financial storm, the fear still hits home. You could compare this to being told your airplane may be about to crash, would the first thing you did be run up and take control of the airplane away from the one person on the plane qualified enough to fly it? Unless you consider yourself a financial guru, the most qualified person to handle your money is a financial adviser and that is true whether the economy is good or bad. People want to feel in control during a time of crisis and you still are in control and can voice concerns and ideas to a financial adviser but don’t throw the pilot out of the plane when they are trying to prevent the plane from crashing.
Do you all agree or are there readers out there who have had bad experiences with financial advisers and prefer to make their own choices about investing? I would love to hear from others about what you feel the value of a financial adviser is.