Why Should You Hire a Financial Adviser?

Many people have this common question;‘Why should I pay somebody to manage my finances?’ This is of course quite justified until you understand how beneficial financial advisers can be.

Based on 15 years of research, analysis and testing, Vanguard, one of world’s largest investment companies concluded that when you work with a financial adviser, there is a quantifiable increase in returns. A separate study by Russell Investments, a large money management firm, estimated an increase of returns by 3.75 per cent when a good financial adviser is hired.

These studies are proof of how beneficial a financial adviser could be. Before we go on to explain in detail the main benefits of hiring a financial adviser, let us first understand what or who a financial adviser or a financial planner is.

A financial adviser is an individual who has expert knowledge and appropriate qualifications that can offer valuable industry insight and expertise above that of a laymen or general consumer. An insurance adviser is usually consulted when you are seeking specialised guidance or advice for investment in various insurance schemes. Whether you require a financial adviser or not depends completely upon your financial goals, the complexity of your financial matters, your knowledge of the financial market and your current financial situation.

Warren Buffett once said that to invest successfully, one must have a sound intellectual framework for making investment decisions and the ability to prevent emotions from disintegrating that framework.

Simply put; hiring financial solutions providers can help you to achieve your financial goals.

So, let us now look at the actual benefits of hiring financial solutions providers.

1. Expert skills and knowledge means less risk

The complex legislation and the dynamic environment of the finance industry with a growing number of wealth creation and investment options has made financial planning even more intricate. Trading or investing in this uncharted territory alone potentially exposes you to high-risk whereas a well trained and skilled finance professional will understands these risks and will walk you through the pros and cons, offering every opportunity to improve your financial position while reducing your risk.

2. Personalized Plans

A single generic financial plan cannot suit every individual’s need. A good financial planner will help provide a customised financial strategy to suit your specific financial situation and should work with you to customise your own financial plan and success goals.

3. Documentation of the Goal

The duties of a good financial adviser should not end at helping you to choose the right investment. They should also help you to discover, document and update your current financial goals on an ongoing basis. These written goals are a constant reminder for both you and your adviser of what needs to be achieved.

4. Unbiased Decisions

When investing, it is essential that the balance of emotional connections between the investor and the investment have a buffer of experience. A good financial adviser should understand your emotional connections however they should offer impartial advice. A financial planner is free from these emotions and impulses and can help you make fact-based choices.

While most Australians seek financial independents, only a small percentage actually achieve it.

Improve your investment choices - be smart, invest smart and get advice from experienced professionals.

Maria Smith is a writing enthusiast who likes to explore and talk about trending topics.Se belongs to Australia and likes to contribute her part of knowledge by writing articles for her followers.