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5 Reasons Why Working with a Financial Advisor Pays Off

Investing on your own may not be the best option for critical life goals.

Today, investing on your own is easier than ever. But is do-it-yourself the best approach for you? Before you embark on this journey solo, consider the key benefits that can be gained from working with a professional advisor.

  • Benefit from their expertise and time

Even if you devour the latest in financial news and your TV is constantly tuned to the financial networks, it’s hard to compete with the professionals when it comes to access and depth of information, and the time you can dedicate to your investments. They can also handle complex topics that require professional expertise such as portfolio rebalancing and tax planning.

Financial advisors have gained the training and licenses to develop a deep knowledge of these topics, and are often backed by a wealth of corporate resources. Plus, the investment world constantly changes. If you have a full-time job, you’ll likely never have as much time to dedicate to the markets as somebody who focuses on them all day, every day. That’s time away from your family, friends, and other interests. 

Even if you’re retired, you probably have many interests that keep you busy. When working with a financial advisor, you are partnering with someone who has devoted their career to understanding and monitoring the markets.

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  • Objectivity to take the emotions out of investing

It’s not easy to avoid feeling fearful in the middle of a severe market downturn and selling when it would ultimately harm your portfolio. When the markets are flying high, it can be equally challenging to resist the temptation that can make you want to invest more in stocks than you probably should. An advisor can serve as an objective sounding board to help you avoid overreacting to short-term events and stay focused on your long-term plan.

  • Develop a full-fledged plan that focuses on more than returns

When investing on your own, it’s natural to focus only on finding investments with the highest returns. An advisor will undoubtedly recommend options with a history of delivering strong returns, but they’ll also develop a plan for you that keeps many other key considerations in mind including legacy and retirement planning. 

  • Ensure proper diversification and risk management 

Advisors are trained to devise financial plans that provide exposure to a mix of investments that will perform differently in various economic scenarios. That strategy increases the odds that at least a portion of your portfolio will do well in any climate.

A financial advisor will also recommend investments that will match not only how much risk you can tolerate, but also how much risk is appropriate for where you are in your investing and life journey. 

Another benefit may be getting insight into how your investments will affect your taxes. An advisor can devise a diversified tax strategy that’s right for you.

  • Opportunities to incorporate your values into your investments

Many people are increasingly looking to bring their personal values to investing, and a wide assortment of investments can facilitate that. If you’re concerned about climate change, for example, you can invest in ETFs that support clean energy. If you’re passionate about equality in the workplace, you can invest in funds that own companies with high scores for diversity and inclusion. While you could find these investments on your own, a financial advisor can help ensure that your valued-based investments will fit within your overall portfolio. They can also help you select funds that will allow you to incorporate your principles without sacrificing the long-term growth you will need in your accounts.

Find the advisor who is the right fit for you

Ready to find an advisor? Take our no-obligation Financial Personality Assessment that will help you discover the financial personality traits that influence how you like to invest. Then receive recommendations to connect with like-minded advisors at no cost. 

Connect with a financial advisor who aligns with your financial personality by taking our 3-minute quiz.

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