Being green and fresh out of college, I always thought that financial advisors were experts in managing investments.
Then, I got my first job and quickly learned that 100% of financial advisors are in sales. It came as a shock to me, that people who trust their life savings to the advice and guidance of these individuals knew just enough to convey themselves as “experts” to their clients.
I remember one time an elderly gentleman called in who was about 75 years old. It was clear he didn’t know how to use a computer and called in to have some help him find some information. Being vivacious and optimistic about professional life, I went out of my way to help out this senior citizen.
The very next day, my manager called me into her office to review the phone call. She informed me that I’m not allowed to provide the information the man asked for because it was considered providing “Financial Advice.”
Being 22 years old, I explained my case that, this wasn’t giving any financial advice, but just providing information anyone who knows how to work a computer can find.
My manager disagreed and informed me that the company doesn’t give “Advice & Guidance” to its investors. At that point in time, I realized there is a huge problem in the financial industry. And where there are problems, there are solutions. And I wanted to be part of the solution, not the problem. At that point in time, I decided to make it my mission to educate people on the best ways to grow their wealth.
Nowadays if you have a financial advisor, more likely than not, they aren’t choosing the investment strategy.
The strategy is picked by money managers that you will never have a conversation with, never meet, and certainly don’t know you exist. This leaves investors in a quagmire of a situation and is the reason why 99% of Americans don’t use a financial advisor.
For a majority of investment advisors, all they do is figure out is your comfort level for risk, place you into a predetermined portfolio, and call it day. But, this is not going to give you an unfair advantage when it comes to investing.
When hiring a financial advisor, it’s extremely important to find someone who has experience with managing money and is going to provide you a service that can’t be duplicated by the masses.
What this has done is caused a chain reaction to having investors flee into choosing their own investments and with the easily accessible trading platforms, anyone with a smartphone can become an investor within a few minutes. There’s nothing wrong with wanting to invest your own money because giving up control of your assets to someone else is scary. However, if you’re able to find someone who has a level of expertise that will help you leverage your time and give you the opportunity to earn a reasonable return. This is where it pays to hire a financial advisor.
When it’s all said, and done, a majority of people who have their money managed are going to remain with big faceless organizations because they offer a turnkey solution.
This keeps people from wanting to change which is hard for anyone, yet the only way to grow in this life is to constantly be adapting as the world changes around us.
With the transformation of the world being as constant as time, it’s apparent that those who are willing to adapt will find themselves in the winner’s circle.
While those who are unwilling to adapt, will find themselves living in a world they don’t understand.
Joshua Krafchick, “The Unconventional Money Guy”
Additional Reading to educate you on your finances:
1. What to sell when you need money.
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