Myth-Busting Wealth Management

Myth #1: “I Can Manage My Finances Alone.”

While many are capable of managing their day-to-day finances on their own, there’s a major difference between managing and planning – and the distinction between the two is where a financial advisor can truly add value.

When people manage their own finances, they typically focus on here-and-now tasks like sticking to a budget, saving up for large purchases and paying taxes. These are all important components of wealth management, but there’s so much more to plan for:

• Have you considered strategies to lower your tax burden – not only for this year’s return, but for years down the line?
• Does your current wealth plan consider future what-if scenarios, both in the market and in your personal life? Unforeseen health concerns or changes in family dynamics (like a death in the family or a divorce) could dramatically affect your plans.
• Is your existing savings strategy designed to help you thrive both now and in the future?

Experienced advisors have the expertise and resources to look at your finances far beyond the here-and-now. Rather than managing your finances just to get you through the present day or end of the year, they’re considering your future, and how the strategy you have today can help you accomplish what you want tomorrow.

Advisors can also help you establish a robust estate plan – and facilitate important discussions with your family and other loved ones. It’s no secret that conversations around passing wealth can be challenging and awkward – but your advisor is there to serve as an objective party, explaining the facts and encouraging continuity throughout your family tree.

Myth #2: “I Don’t Need Help Investing.”

With an advisor’s guidance in this area, you’ll learn more about how the investments in your portfolio work together and be better able to make smart decisions with your portfolio. Investing is about more than what to buy and what to sell – it’s also about risk tolerance, liquidity and cash flow needs, time horizon, taxes and asset allocation. These factors will vary from person to person, which means the general buy or sell recommendations you see on television or read about online might actually set your portfolio back. By collaborating with a financial advisor, you can develop a plan designed to reflect you, not what you see in the headlines.

Advisors also serve as an objective outside opinion. There’s no doubting that you could manage your own investments – but can you give yourself the necessary emotional distance when needed? Selecting investments for your portfolio is often personal, and when the market becomes volatile and those investments experience outsized gains or losses, it can be hard to make sound decisions about what to do next. An advisor can act as a sounding board and offer reasoned, prudent advice.

Myth #3: “Hiring an Advisor Is Not Worth the Fee.”

Maybe you believe paying an advisor to manage your wealth and investments is simply wasting money on a service you could provide for yourself. But consider other professionals involved in your life: Why do you pay an auto mechanic to tune up your engine, a hairstylist to cut your hair or a plumber to fix a broken pipe? Those services could be completed on your own – but hiring an expert in those areas often proves to be more valuable.

This is just as true when it comes to your finances. We all know how fast life can move – by handing that responsibility over to an advisor, you can remain as involved as you’d like and confident they have you covered. From deciphering new tax legislation to keeping track of RMD dates to inflation-proofing your retirement, those obligations would no longer be on your already-full plate.

There’s so much more to life than money – so take your newly freed-up time and spend it doing something that truly makes you feel fulfilled.

Myth No. 4: “I Already Have an Estate Planner and an Accountant, So I’m All Set.”

There’s no doubting that estate planners and accountants play a significant role in managing your financial life – however, their professional responsibilities are quite different from those of a Financial Advisor. While accountants typically prepare and file tax documents and create financial statements, their responsibilities tend to focus more on the present day than the future. And because estate planners draft wealth transfer and legal documents, they tend to have a limited focus on long-term, end-of-life planning.

Because advisors are so involved in many aspects of your finances, they serve as dot connectors, reaching out to your accountant, estate planner, legal advisors and others to ensure all the plans you’ve created are working effectively together, with no gaps or redundancies.

Myth No. 5: “I’m Not Wealthy Enough To Require a Financial Plan.”

The truth is, wealth planning is for everyone – regardless of how much money you have. Whether you’re building up your nest egg or are nearing retirement with liquid, investable assets, you can benefit from a plan designed to build and protect your wealth. So what’s the harm in taking the first step and reaching out to an advisor?

Even if you feel you’re not ready to engage a financial advisor quite yet, most are willing to sit down with you and discuss your concerns at a high level. If the advisor feels you could benefit from their ongoing guidance, they might offer to explore the idea of you becoming their client. If they feel someone else might be a better fit for your situation, they’ll guide you in their direction – and you can continue to pursue your wealth goals with someone who has the resources and expertise to support you.