Aseanoutlook.com – Any young adults in this world probably already have heard about financial advisor. It’s not an uncommon term, especially for ones that’s just a beginner when it comes to adulting. You need all the help you can get, and that’s where financial advisors can help you.
What are Financial Advisors
Financial advisors are people that offer assistances, or even in some instances, a complete management of your finance. The term financial advisor itself is widely used to refer to services such as investment managers, financial consultants, and financial planners. You can even get a mostly digital financial advisor called robo-advisor.
What financial advisors do
The service that your financial advisor will do will depend on what type of advisor you’re hiring. Generally speaking, they will help you assess your current financial situation that includes your assets, debts, and expenses and then identify where they can make improvement in your finance.
A good advisor will ask their employer about their goals and then create a plan that will help them achieve that goal. This can mean calculating how much they should save for retirement, making sure that they have enough emergency fund, tax-planning suggestions, or helping them refinance or paying off debts.
In some cases, you can choose yourself which services you want or need based on the type of advisor that you selected. For example, a traditional advisor that comes to you or an in-person advisor will most of the time offer a personalized, hands-on guidance for an ongoing fee.
Meanwhile, there’s also a robo-advisor that offers a low-cost, automated portfolio management service. This type of advisor is best for those that needs a helping hand to manage their investment.
Or, if you want an online solution for your financial advising needs, there are online financial planning services that has the lower-cost of robo-advisor as well as the holistic guidance that on-person advisor has.
When should you consider getting a financial advisor?
Most adults in the world that have already established their routines and financial management won’t probably require a service such as financial advisor, so when is it right to be thinking of getting one yourself?
Generally, financial advisor is useful for someone that is struggling or having problem prioritizing their financial goals, requiring a plan for where and how to save for something, or if they want help with their investment management.
Because they can give an expert and outside view to your finance problems and then taking a look at it and suggest improvements that you can make. They can also help you navigate complex or difficult situations such as taxes, estate planning, and of course paying down debts.
They can be worth the cost if it ends up with you being able to save more money and cut expenses for a better future. Not only that, but they can also help you feel more secure about your financial situation, which some considers to be priceless.
That being said, financial advisors do come with high fees. Depending on the type that you’re hiring, you might pay anywhere from 0.25% to 1% of your balance each year. Some also charges a flat fee to create financial plans or an hourly, monthly or annual rate.
If you’re just a young adult starting out in this world, a robo-advisor or online advisor above may be the best fit for you because on-hands advisor is considerably more expensive.
What you should expect from financial advisors
After taking the time to understand the ins and outs of your finance, your advisor could offer you recommendations such as:
- Planning to meet your goals
- Assistance with saving and budgeting
- Explain the various account structures that might be beneficial for you
- Identify the right asset allocation or investment for your portfolio
- As well as answering any financial questions that you may have for them.
Bottom line is, financial advisor are people who offers their services to help you manage your financial situation, what included we’ve already explained on the paragraphs above.
The question on whether you need it or not, however, depends on you entirely as a person. If you follow the financial tips article of ours, chances are you won’t need one.
But that being said, if you have a large sum of money, or if you intend to manage your investments, financial advisors will be very beneficial for you.
That’s all from us from now, thank you for reading this article and we’ll see you again later.