We are in a unique era for wealth management. Today, just about anyone can open an investment account and trade from their own laptop. Investors have a wealth of information at their fingertips, and some do-it-yourself investors have achieved double-digit returns by concentrating a portfolio in tech stocks. It’s no surprise that we are often asked “Why do I need a financial advisor?” But working with a financial advisor has many benefits, not all of which are directly related to finances.
3 proven investing lessons from Walter Schloss
Walter Schloss is a legend in the world of value investing. Born in 1916, Schloss experienced first-hand the evolution of the stock market from a speculators’ paradise to a place where experienced and intelligent investors tried to take advantage of market opportunities and buy securities trading at a lower than their intrinsic value. Schloss also formed Read more
The role of a financial advisor
Financial advisors help clients meet a full range of needs. They work closely with clients to develop and maintain tailored investment plans based on the individual’s unique goals and circumstances. For example, each person has a risk tolerance that is a function of their investment time horizon, as well as their ability to emotionally withstand the ups and downs of the market. By appropriately adjusting portfolios to account for various factors, including risk tolerance, a financial advisor can help clients achieve greater risk-adjusted returns over time.
We all know that “it’s not just how much you make, but how much you keep” about your return on investment. Financial advisors can recommend tax-efficient ways to approach the client’s investment model and trading activity to maximize net returns. Financial advisors can help mitigate the risk of further losses by ensuring that you have the right amount of insurance coverage for your needs and that the appropriate estate planning documents are in place.
Working with a financial advisor also has other, less obvious benefits. The primary role of most advisors is to educate their clients. Investors don’t need to be financial experts to be successful, but they do need to understand a few basic concepts, and a good advisor will help you build that knowledge over time and throughout your relationship.
Another benefit of hiring a financial advisor is that they help clients set financial goals that align with their values. Whether a client wants to accumulate enough money to travel the world in retirement, or fund a scholarship for underprivileged youth, or help pay for a grandchild’s college education, or all three, a financial advisor can help establish clear financial goals. then develop and implement a plan to achieve them.
achieve financial freedom
Comprehensive Advisors also act as an accountability partner to ensure clients are actively working towards their goals – and not undermining their own efforts. It’s easy to get sidetracked while taking the steps necessary to achieve financial freedom. An advisor will check in regularly to keep clients on track and keep an eye out for any changes in a client’s goals or circumstances that might warrant adjustment to the plan.
Perhaps the most often overlooked role of an advisor is that of a trusted confidant. Inevitably, every person will experience moments of crisis. A relationship with a trusted advisor can be invaluable during these difficult times. By helping to avoid decision-making based on emotion, an advisor can help clients avoid the kinds of mistakes that can derail a financial plan. And, if things change irrevocably, an advisor can serve as a valuable vector of continuity by helping a spouse, children, friends, or anyone designated to manage a person’s affairs to make decisions on their behalf. Knowing that someone will continue with the financial plan – and carry out a client’s wishes – when they are no longer able to do so can bring peace and comfort.
About the Author
Julie Williams is Vice President at Wealthspire Advisors and is a Wealth Advisor in the Delafield office. With over 25 years of experience in the industry, she develops a close and personal relationship with her clients. As a consultant, she partners with her clients to clearly define their goals and uses proven planning strategies to achieve their goals.
Wealthspire Advisors LLC is a registered investment adviser and a subsidiary of NFP Corp.
This information should not be construed as a recommendation, an offer to sell or a solicitation of an offer to buy any particular security or investment strategy. Comments provided are for informational purposes only and should not be relied upon for accounting, legal or tax advice. Although the information is believed to be reliable, Wealthspire Advisors cannot guarantee its accuracy, completeness or suitability for any purpose, and makes no warranty as to the results to be obtained from its use. © 2022 Wealthspire Advisors