Financial Advisors: The Good

Like everything there is a good to the bad...here is the good on Financial Advisors. (please see last post for the BAD).

The main reason I see someone needing a Financial Advisor is to do what you can't. No shame in that. I can't repair a car to save my life. An Advisor can advise on how you should plan your financial future.

An Advisor can help with:

• Asset building investments (stock picks, mutual funds).
• Retirement: If you're close to retirement they can help figure out how much you need to live through retirement and what your allocation/investments should be to meet these needs.
• Estate Planning: If you're not of the mind set to die penniless, cause ya can't take it with you than an Advisor can help plan so your heirs get some of your hard earned money.
• Goals: Working with an Advisor you can plan out goals and how best to achieve them. Ex. you want a shiny new car but don't think you can or should afford it...well, an Advisor can help work this out. And let's not forget about the kids college savings plan you wouldn't mind some help with.
  
• Monitoring your investments: If this is something you don't enjoy than why not let someone else do it.

The most important point is the management/monitoring and setting/achieving goals. While you should remain observant, why have a second job of money management when a professional can do it for you. Furthermore, do you know you financial goals and how to get there? Again, an Advisor might be a good idea.

In the last post I suggested caution around the fee structure. With that in mind, every person needs to ask themselves if an Advisor is right for them and is they one they're contemplating the right one (kinda like getting married).

So, what did I suggest to my friend's dad? Based on the fact the he is pretty hands-off on his finances and doesn't have much interest in being hands-on I think an Advisor is right for him. However, the one he described (fees from the Mutual Funds) seems to have a conflict of interests, so I suggested that he begin interviewing other Advisors. In other words, date around before getting that marriage license.