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Whom do you depend on for financial advice? GOBankingRates recently surveyed 1,001 Americans to find out who acts as their primary source for money advice, and findings reveal that less than 1/3 of them receive guidance from a financial advisor or personal accountant.
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Working alongside a financial advisor is an investment. Consider some of the following benefits that come from having an objective third-party advisor assist with your finances.
Financial Advisors Are Knowledgeable
There’s a lot that goes into personal finance. Each individual has a unique financial situation. Often, this means there is an aspect of finance they might not understand. A lack of understanding, or relying heavily on a family member or friend with a limited amount of knowledge, might lead to making major decisions based on emotion rather than rational thought.
Working with a financial advisor allows you to reap the benefits of an objective third-party. Many financial advisors have likely seen all kinds of financial situations and may offer multiple solutions. Drew Feutz — CFP, co-founder and financial planner at Migration Wealth Management — said a financial advisor can help shorten your learning curve.
“Sometimes you just don’t know what you don’t know,” said Feutz. “The world of financial planning and investment management is huge. Having a financial advisor on your side to help you with those things that you don’t even know that you should be doing can be a huge benefit.”
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They Can Do What You Are Unable To Do
Money is deeply emotional, especially during periods of economic uncertainty. Colby McFadden, founder and CEO of Quiver Financial, said in addition to receiving guidance, a well-rounded and experienced financial advisor should be able to add value to a person’s life by being able to do what that individual isn’t willing or able to do.
McFadden uses the example of an individual who has a tendency to feel stress around investment decisions. They are seeking an advisor to manage their investments who is not emotional about making money decisions. A financial advisor will be able to bring a necessary non-emotional perspective to the table.
“For modern times and the current market we are in now, an advisor may have a skill set or a system of managing risk that prevents losses in bad markets that the individual may not be aware of or able to execute on their own,” said McFadden.
They Can Help You Plan for the Future
If you don’t have a financial plan for your future, or the future of your loved ones, a financial advisor is ready to help out.
Brett Estep, chief operating officer and a founder of Insured Nomads, said a financial advisor can help you plan not only your own financial well-being, but also the well-being of your loved ones.
These professionals can help keep your finances in order to plan for retirement, prepare for unexpected hardships and understand your tax liability. If you’re married and there’s a spouse who is money-oriented and a spouse who isn’t, working with a financial advisor to create a long-term financial plan allows both spouses to be on the same page and ensure they understand the family’s financial situation.
“A good advisor can give advice and help you invest your assets wisely for long-term or short-term gain, tailored to your needs,” said Estep.
Advisors Have Answers to Your Questions
If you still aren’t sure whether your financial situation requires an advisor, McFadden recommends gauging the answer by being conscious of your feelings around your money quandaries.
“If you find that your mind is circling back to the same subject or question about money, and you begin to feel some emotion at the times of those questions, then chances are you need an advisor or at least a confidant to have a discussion with to start the path to finding answers to your questions that can ease your feelings,” said McFadden.
You Have a Confidant in a Financial Advisor
No matter where you are on your financial journey — whether you need a check-up on your current financial plan, investment advice or are simply seeking an accountability partner — a financial advisor is a trusted confidant who will ensure you don’t have to go it alone.
Alissa Krasner Maizes, financial planner and founder of Amplify My Wealth, said not to let analysis paralysis be your excuse in finding and working with a financial advisor.
“Partnering with a financial advisor to attain an individualized financial plan that aligns with your goals and risk tolerance can help you along your journey to amplify your wealth,” said Krasner Maizes.
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