So What Does a Financial Advisor Do?


Saving money for college?  Planning for retirement?  Dreaming of a beach home?  Reaching your financial goal seems easy enough to do on your own, right? But is it?

You may tell yourself each month that you are going to save X amount of dollars, or that next year you will take that dream vacation, or that in 2 years you will be ready to buy that new home or send your child to the college of their dreams, but then life gets in the way – an unexpected expense here, a few impulse buys there and before you know it you are no closer to reaching your goals than you were a year ago. This is where a professional can step in and help you reassess your goals, working with you to help you attain them.

So, what does a financial advisor do?

Educate: Advisors have the investment knowledge that you may not. They become your financial educator, planner and partner. They can help you understand what is involved in meeting your goals and what you need to do to get there. They can help you understand budgeting and saving, help you understand the more complex investments, risks involved, and even insurance and tax.

Provide an unbiased view of your current finances: You may be overlooking important information or obstacles that are getting in the way of you reaching your goals. An advisor has a trained eye for spotting these obstacles. They can help properly address your assets, liabilities, income and expenses.

Help you understand your risk tolerance: Have you thought about how much risk you are willing to take on?  All investments have risk.  The investments you choose should be in line with the level of risk you are comfortable with.  A financial planner can ask the right questions to truly get a sense of how much risk you are willing and able to take and build a portfolio that stays in your comfort zone. 

A Voice of Reason:  Investing can be emotional.  It is easy to overreact to the highs and lows of the market.  When the market is soaring, it is easy to get too aggressive and when the market is low, we tend to get scared and can make the mistake of selling out too soon.  Both these ideas can be detrimental and harm you in the long-term.  A financial planner can help you rationally navigate the highs and lows of the market.  

Alleviate the pressure on your spouse or heirs:  When the time comes to settle your estate and your end of life affairs a financial advisor is there to help.  During an already stressful time your planner can assist your family members who may have no idea where to even begin.  All financial advisors have dealt with the death of a client and can offer support and advice to help navigate through the process.

Provide access to professional research:  Financial advisors have access to many powerful tools to provide unbiased research on many varied investments.  They can show you the facts about a particular investment and how that investment fits – or doesn’t – in your specific plan. 

Provide a financial plan:  When you work with a financial planner a plan is built specific to you. There is nothing generic about a financial plan built by a financial advisor you hire.  A one-size-fits-all arrangement does not take into account all the personal nuances that must be considered in order to build a plan.   You work with your advisor to design a plan that takes into account your input and your specific needs and goals.   That plan then acts a map to follow and will help keep you focused on your specific strategy and your long-term needs. 

Research shows that working with a professional financial advisor can add 1.5% to 4% to the growth of your accounts.  (  Isn’t it time you spoke with a financial professional about achieving your financial goals?



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