Broker Check

Why Hire an Advisor?

| March 18, 2014

Minimizing emotional decisions is more difficult than it seems!

Getting it right is more work than it looks!

Way “back in the day,” it was not actually physically possible, to a very great degree, to do your own investing.

Younger people reading this might be shocked, but when some of us started working, there was no internet!  (Whoa!  What would we do now without it!!)

Even more importantly, there were no 800 (Toll-Free) phone numbers in common use (the real start, in my opinion, of “Do-It-Yourself” investing.)

Also, “No-Load” mutual funds didn’t exist.  (There’s a subject for a different post!)

So, now that it clearly is possible to do your own investing, why pay an advisor?

In some cases, the answer is obvious.  You simply don’t have the time, interest, or inclination to do it yourself.

Or, you might have a loved one (e.g. mother, grandmother, aunt, sister . . .etc.) who is also unwilling and / or unable to do it themselves.  So from a family / personal perspective, it makes more sense for your loved one to hire an advisor (with your help and guidance) than for you to do it for them.  (Also helps limit your potential legal liability!)

In addition to the above, my view is that there are more reasons to hire an advisor, even if you are a sophisticated investor and computer user who is more than capable of putting together a solid portfolio using resources currently available to you.

Disinterested but not uninterested!

There is lots of research out there showing that investors in mutual funds (for example) do considerably worse than the funds do themselves.  Rightly or wrongly, funds are managed by full-time investment professionals for whom money management is a business.  Not to say they are never wrong.  Or never make emotional decisions.  But they try to minimize them!

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