Here's a comment left on my post titled Would You Hire a Part-Time Financial Advisor? It mirrors my own thoughts on personal finance learning and implementation, so I thought I'd share it with all of you:
I personally think most people are better served becoming educated enough so that they can be their own financial advisor. The vast majority of financial advisors appear to be financial product salesmen, first and foremost. Flat fee advisors would be my choice if I decided I needed one, but personally I think I know enough to get by without one. I may decide to hire one at some point, but if I did, I don't think it would be for investment advice, planning how much I need for retirement, or setting savings goals. I can do that pretty easily on my own, and by doing it myself I think I'm much better positioned than relying on someone else who isn't as "invested" (pardon the pun) in my financial success.
If I hired one, it would be for specialized knowledge that I didn't have or didn't have the time or desire to acquire. For that reason, I'd probably be more likely to hire a CPA or tax attorney, because those fields of knowledge pass that test for me.
That's the main purpose of Free Money Finance -- to help educate you so you can become your own financial advisor. That's why I comment on so many articles, link to various pieces, and include my own personal finance thoughts gleaned from my years managing my own money. If you just keep reading, something good is bound to rub off, isn't it? ;-)
Agree fully that a financial advisor should augment your financial knowledge and not be 100% of your financial knowledge. I look for mine to provide important perspective on various options that I am considering. Since they have seen the experience of hundreds of clients and keep up with industry updates, I get the latest info that would normally take me hours to find and analyze.
Being a frugal person, I had always thought I would use a flat fee advisor, for some of the same reasons you stated. Currently, I am very happy with my specific manager who is asset fee based, both in returns (12.8% after fees vs. S&P at 12.6% to date) and range of services provided.
They provide full service - estate planning evaluation, retirement planning, college savings etc. A bonus I get is they even provide, at no additional cost, occasional advice on personal investments, which are greater than what they manage. For example, they recommended a 529 plan for me to invest my personal funds.
Disclosure: I have no financial interest in any financial planning services nor am I (or related to) a financial planner.
Posted by: Super Saver | November 24, 2006 at 04:47 PM