5 Common Misconceptions about Financial Advising

If you’ve got financial goals (we’re sure you do) and are wondering how to achieve them, the right financial advice can get you there. 

Working with a firm that provides professional financial advisory services can help ensure you’re on track to realize your goals. You’ll work with experienced advisors, who will make it easier for you to manage your money, investments, and other assets while maximizing your resources. 

Unfortunately, many people harbor the wrong notions about what financial planning and advising can and cannot do for them. 

For instance, some believe that retirement financial advisor services can forecast the future and make guaranteed predictions about the economy and market trends. Others think that financial advisor services are super expensive. Both these assumptions couldn’t be farther from the truth. 

It is important to avoid such misconceptions and hire proven financial advisor services who will bridge the gap between you and your money goals. The right advisor will provide you with the ongoing support and realistic guidance needed to steer through volatile markets and make informed decisions. 

Mentioned ahead are some more misconceptions that people have about financial planning and financial advisor services. Let’s bust them without further ado. 

Misconception 1: Financial advising is only for people who have a lot of money. 

Fact: Financial advisor services are for everyone, regardless of income or net worth. In fact, financial planning professionals work with people from all walks of life and help them create a plan that revolves around their specific financial goals. 

Gone are the days when providers of financial advisor services applied traditional approaches to wealth management. Modern advisors rely on factual data and the latest technologies to provide efficient services even to those who may not have a ton of money yet. 

The right advisor will know that a period in your life when you don’t have much money may actually be the perfect time to seek their help.  

Misconception 2: Financial advisors only want to sell products and make commissions. 

Fact: A major misconception is that financial advisor services are only interested in earning fat commissions by selling financial products, like mutual funds and insurance policies, of certain companies. 

While it’s true that some advisors do have a sales component tied to their business, reputable advisors prioritize their clients’ goals over everything else. Also, most advisors nowadays are fee-only fiduciary advisors, i.e., they charge as per the services they provide and don’t get commissions. 

This means clients can rest assured knowing that the financial advisor services they’ve hired are committed to their client’s best interest. 

Misconception 3: Financial advisor services are costly.

Fact: Some people think that financial advisor services are not worth the cost. While financial planning and advisory services do come for a fee, there are various options for people with different budgets. 

Some advisors charge a fixed fee, while others charge a percentage of the assets they manage. Regardless, it is important to remember that the potential benefits of hiring financial advisor services, whether tax saving or maximizing ROI, far outweigh the costs associated with them. 

Misconception 4: All my money will end up in stocks.

Fact: Experienced providers of financial advisor services understand the importance of diversifying the investment portfolio. So, they certainly won’t put all of your money into stocks. They’ll help you make short-term savings for emergencies and large purchases, as well as maintain long-term accounts, which can involve stocks. 

Even if your money is invested in stocks, it won’t be single stocks as that can be risky. Before investing your money, your advisor will assess your risk profile and tolerance to devise an appropriate investment strategy for you. 

You can then look forward to a balanced and diversified portfolio consisting of stocks, bonds, mutual funds, ETFs, and so on. The diversification will be done to mitigate the risks associated with market volatility. 

Misconception 5: I can do it all myself. 

Fact: It isn’t uncommon for people to take the DIY route to manage their money. But did you know that financial advisors may be able to add 3% in net returns for clients by utilizing certain best practices?

Moreover, providers of financial advisor services have vast experience in using modern tools, applications, and data to clearly see the bigger picture and base their decisions on market-related facts. This allows them to do their job more effectively. 

In other words, working with a financial planning and advisory firm can give your wealth management initiatives a much-needed boost, thereby securing your financial future. 

In Conclusion

Financial advisory services are your best friend if you’re serious about achieving your financial goals and building long-term wealth. However, it is important to avoid believing the common misconceptions about financial planning and advising. It’s always a good idea to work with a reliable advisor as they’re perfectly placed to make your money work hard for you. All in all, a good financial advisory service will help you create a plan that’s in line with your unique financial vision and goals. 

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Written by Sandy Funches

Sandy Funches is a freelance writer who enjoys writing. Writing is of utmost importance to her as doing so helps her educate people by spreading her knowledge.

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