“What am I paying you for?”
Do you know what your financial advisor is doing for you?
With over 300,000 financial advisors in the U.S., it can be hard to tell if you are working with the right person and to know if you are getting good value for what you are paying them. You’ve worked hard for your money and it can be a leap of faith to entrust your financial life to someone else. Vanguard outlinesand puts a value to working with an advisor instead of trying to manage your financial life by yourself.
As shown, financial advisors can add value in a variety of ways – all of which could help you. According to this study, the top three ways in which advisors add value is through behavioral coaching, spending strategy and asset location advice. This includes helping you identify how much to save, making sure you keep investing even during volatile markets, and making sure you have a personal financial planthat achieves your long-term goals.
This small list was determined to add about 3% in net returns annually. An independent fiduciary advisor can be a steady and professional guide to help you accomplish your goals and help prevent you from making meaningful financial mistakes.
Ron and Samantha were on track to meet their retirement goals until 2008, when the stock market crashed and Ron got scared. He sold out, locking in a 30% loss in their investments, and has been too nervous to get back in the markets. Now that they are planning on retiring, their retirement goals have been drastically cut since they missed out on substantialgrowth in the market. An advisor makes sense if you don’t have the time, the knowledge, or the emotional fortitude to make good investment decisions.
Back to the original question: Do you know what your advisor is doing for you?
If you can’t answer this question confidently, then we should talk. Through your Financial Life Inspection®, Pacific Capital will help you make sure that you are receiving quality advice at a fair price from your current financial advisor.