How to Double Your Investments and Limit Your Risks: Hire a Financial Planner
The desire to manage one's finances with the goal of becoming financially stable and, as much as possible, financially independent, is an admirable objective. It is a simple fact that the better a person's financial stability, the better their quality of life is in a number of areas. That a person should seek financial stability is a given. The question of whether this is a pursuit that can be effectively managed alone is another matter.
With a worldwide economy that has been stubbornly sluggish for several years now, it is more important than ever to make wise financial decisions, and the average person cannot afford many mistakes in managing their hard-earned financial resources. And while the margin for error seems to be decreasing, the complexity of personal financial management seems to be increasing. Gone are the days when effective financial planning could be as simple as setting aside a portion of income into a simple savings account. In today's economy, hiring a competent financial planner offers a wide range of benefits.
Reduce Money Stress
It's true that having money makes life easier in many ways. But the converse is also true: not having enough money makes life more difficult. American psychologists estimate that money issues cause 75 percent of the stress experienced by the average person. Earning money takes time and effort, and attempting to make the money you have grow requires research, decision-making and risk-taking. Add to this the stress experienced by self-directed investors who suffer setbacks, losing not only hard-earned money, but also time.
All the facets of our increasingly complex and fast-paced lifestyles must mesh together and still fit into a 24-hour day. Hiring a financial advisor simply gives you one less thing to worry about, and reduces the impact of what is for most people life's biggest stressor - money. Relying on a trained professional to help set a long-term financial course can free up time for other pursuits, including some much-needed downtime.
Expand Investment Opportunities
It is part of the job of a financial advisor to stay abreast of investment products and concepts. There is no shortage of new investment vehicles, many of which can be quite complex. The average investor seeking to navigate the increasingly complicated world of financial product offerings may likely never become aware of much of what is available. Even more, it can be difficult to determine which products may be applicable to an investor's current situation, long-term goals, and tolerance for risk.
Avoid Information Overload
It can be tempting to think you can effectively do your own research and manage your own financial planning. After all, the Internet makes it possible to have a wealth of information at your fingertips, and therefore, it should be just a matter of doing a little research.
It is only after one embarks on such an endeavour that they realize things are not as easy as they seemed. The sheer amount of information available can be overwhelming and often contradictory. And it is not always clear which sources are authoritative, since anyone can pose as an expert and put up a website. In the Internet age, just as dangerous is not having enough information is having too much. At some point, 'paralysis by analysis' can set in, where you have a deluge of information but still no real understanding of the best course to take.
A financial advisor has already sifted through the mountain of available information and can be your single clear source of advice. Time spent on endless research can instead be directed to creating a well thought out financial roadmap. If you do like to dabble a bit with research and come across what appears to be an interesting investment strategy, a financial advisor can provide a critical second opinion for your ideas.
Get Some Needed Motivation
Think of a good financial advisor in the same way as you would a physical trainer at the gym. A trainer pushes you to do things you likely would not do on your own, all in the interest of becoming more physically fit. In the same way, a financial advisor causes you to make decisions and change behaviours financially, all in the interest of securing a more stable future. In fact, hiring a financial advisor at the beginning of your career will steer you into good financial habits from early on - just look at this article by expert financial advisors Blueprint Wealth for some tips on how to get into good financial planning habits.
It is important not only to have financial goals, but a plan to meet those goals. A financial planner will not only help develop both a goal and a plan, but can also hold you accountable in taking the action necessary to execute that plan to reach your goal. One of an advisor's most critical roles is enforcing the needed discipline.
You Don't Need Two Jobs
You have a job you've trained for and perform skilfully based on your education, experience, and daily focus. Imagine someone taking up your profession as a part-time hobby, and ask yourself if they could do your job as well as you. The answer, of course, is that they could not come close. So ask yourself: what makes you think you can effectively perform the job of a financial advisor – someone with extensive training, experience, and whose full-time job it is to search out the best investment opportunities? Planning your financial future is serious business, not a hobby. A financial advisor is not going to try to replace you in your job. Do not try to replace him in his.
This article was written by investment expert Ellen Richards. Ellen has been writing on the subject of wise investments for over 10 years and recommends to always hire a financial advisor to steer you on your investment path.