Few of us have extensive knowledge about any area of our finances. We look at what we can find in terms of a particular investment area and then make the best decision based on the limited knowledge we’ve been able to gather together.
It’s small wonder then that some people like to use the services of a financial advisor. This won’t apply to everyone of course – some may think using such a person means they’re giving up control of their own finances. Nothing could be further from the truth but it all depends on the individual and their own views on the matter.
So – should you use one or not?
How much do you know about a particular investment type?
If you are thinking about investing in a particular investment vehicle it makes sense to find out as much as you can about it before you do so. You might be acting on misleading information. Maybe you’ve got the wrong idea about how profitable a particular investment might be. Maybe you assume it will provide a certain level of risk when actually it could be far riskier than you think.
Knowing your limits and your comfort levels is a big part of the process when considering any investment possibility. This is an area a financial planner can help you with.
They will always know more than you
This is one of the biggest reasons why some people opt to use a financial planner. Most people can find out the basics about anything using the internet or a few well-chosen books. However beyond this few people would be able to spend time researching a particular investment so they could determine whether it was suitable for them or not.
As such a financial advisor could possibly provide useful in-depth information it would be very difficult to get hold of on your own. You may be able to discover more on your own if you had the time, but few of us would have the time or the energy to delve into the details for any given financial topic. The ever-changing nature of many investments also means whatever we do learn is likely to rapidly become out-of-date before we have the chance to use it.
This is essentially what we pay a financial planner for. While they don’t suit everyone at every stage of their lives, they will suit some people more than others. As such it might be worth considering whether you have an area of your financial life that could benefit from some expert advice at one point or another. If so, you could end up with the chance to make more money than you may have done otherwise.
Perhaps more importantly, you will go into an investment with your eyes wide open instead of simply hoping for the best. A planner may make it easier for you to identify whether an investment was potentially all you had hoped for… or nothing close to it after all.