January 25, 2013

The look and feel of the personal financial planner is changing.  No longer is an office surrounded by mahogany and crown moldings the only choice.  Some of today’s financial planners are much more laid back and casual, but maintain the same level of expertise and financial knowledge.  The internet offers many choices for a planner as well, and it’s up to you to decide based on your needs and goals what will work best for you.

This podcast topic comes from a listener’s email.  Around the same time that we received the email, Brian read an article in the Bloomberg BusinessWeek titled “Financial Planners:  Online vs. Brick and Mortar”.    The article was written by Sam Grobart and was published in December of 2012.

We tend to agree with a lot of the points in the article but believe that it may be a little oversimplified.  We feel that in many situations, there will come a time when a professional financial planner is needed.   If you have less than $250,000 in assets, you can probably benefit from an online planner or even self-management.    When a portfolio is large, there is a baseline of work that goes into designing an appropriate plan that will benefit the client.  We want to offer value to the client’s portfolio without the fees taking away from the performance of their portfolio over the long term.   There is value to someone stepping in and giving an unbiased opinion.  Large portfolios need structure and the expertise of someone who knows the business, and in a downturn situation like 2008, you want someone who can guide you through those complicated processes.  The article refers to financial advisors as “cheerleaders and coaches”.  Financial advisors are certainly not limited to being cheerleaders and coaches, but, then again, what team do you know that can win the big game without a coach!  Good coaches are hard to find and usually well worth the price!

There is a huge gap in knowing how to do something and actually doing it.  Once you get close to 7 figures in assets, there is so much more that you can do with your investments.   A professional planner  can invest in institutional funds, and this is just one benefit of working with a professional advisor.  Sometimes institutional  advisors can even get you into funds that are not available to the general public.

Of course, there are always exceptions to the rule.   A good advisor can help you plan for uncertainty, but there are some people that are really good at planning for themselves.  Even these do-it-yourselfers find themselves seeking help sometimes.  Some people get to a certain age and realize that their spouse will need help when they are gone.   It’s powerful to know that as a financial planner, we can help families plan for their future and be secure.  Some coaches are just better than others and you deserve the best!

If you are curious about the Fee-Only profession, check out NAPFA.org and their find an advisor feature.



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