Do I Need An Advisor?

Before you decide to go to an advisor, ask yourself, do I need a financial advisor? If you manage your own money and are wondering whether you need an advisor’s help, the following questions/reasons can guide you through that decision-making process.

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• Do I have the amount of savings/investments that justifies hiring a financial advisor?
• Do I have the time?
• Do I have the financial training/knowledge? Investing and financial planning is not easy, and if these thoughts are going through your mind then it might be best to team up with an advisor:
  • “The financial planning process looks a bit complicated. I just want to make sure I have thought everything through so I don’t make any big mistakes.”
  • “I am not sure about structuring the overall portfolio, about how much of each asset class I should buy.”
  • “In some cases, I know what I want to buy, but I just want to get some validation.”
  • “I just don’t want to be bothered, especially since I am clueless anyway about how to put together and then monitor a portfolio.”
  • “There are so many different funds out there. I don’t know how to evaluate all of them.”
• Does your spouse trust you? For example, I have my own portfolio of stocks I like managing, but my spouse doesn’t want me to be the only manager of all our money.
• Do I have the interest/passion and emotional discipline to stay with it? (Very Important).

What are my options if I have little to invest?

Do It Yourself (DIY). This includes using robo-advisors and/or using a discount broker with relatively cheap commission fees (information and reviews found in The Safe Investor Amazon, B&N, IndieBound ).

The common questions for both DIY-hybrid platforms (human financial planners with online algorithms) and reputable internet broker are as follows.

• How much risk can I afford to take? There are pros and cons for each financial product. When it comes to investing, there is always a risk/reward benefit ratio. Whether it be ultra safe money market funds or more volatile equity funds.
• How much relevant experience does the representative advisor have? I recommend at least ten years’ experience, even if it is a discount brokerage firm. In the world of investing, you really want the person helping you to have personally lived through a couple of investment cycles, just so you know they have seen what can go wrong.
• Can the returns promised by advisors and salesmen can be realistically delivered?

How do I find an Advisor?

The best sources could be recommendations from family and friends, especially if they are in a similar financial position as you are. You can also google a few of the more well-known sites to research advisors, such as Brightscope Advisors, FApages.com, the Certified Financial Planner (CFP) Board website, and even Yelp (yes, Yelp).

What should I know before I meet an Advisor?

• How much can you put aside? How much would you like to have when you are older? If you have the time, it is worth checking out some of the do it yourself (DIY) websites to have a better idea of your key issues such as major goals, cash flow requirements, and risk aversion.
• Check out the advisor’s website, or at least the prospective firm’s website, to see what they choose to say about themselves or their practice.

Go on the FINRA, SEC, and/or state registration websites to learn what licenses he/she already has and check out his/her history.

Interpretation to these answers: For guidance on how to interpret your answers, please see the book The Safe Investor (Amazon, B&N, IndieBound) .