Advise Financial

Why should you have a financial advisor?
¿Por qué deberías tener un asesor financiero?
14 de May de 2021
Finance for young people after 18 years
Finanzas para jóvenes después de 18 años
28 de May de 2021
Why should you have a financial advisor?
¿Por qué deberías tener un asesor financiero?
14 de May de 2021
Finance for young people after 18 years
Finanzas para jóvenes después de 18 años
28 de May de 2021

Why should you have a financial advisor?

I handle better than the others:

There are several studies that show that people consider themselves to be better drivers than the average driver.

For example, we can test it with co-pilot syndrome; that when you go on that side you brake on the other, you feel that you would drive better.

This is why, in the world of investments, exactly the same thing happens, the non-professional investor tends to think that he is better.

They even think that they will be able to better choose which will be the winning action, the best investment or the perfect time to buy and sell.

Credits: Magisto

Unfortunately, this vision is promoted by the media and people who claim to sell the magic formula to make money.

However, we thought: if it is so good, why are you selling it to me and not using it to make more money yourself?

That story they use when they say that I already have so much money that now I want to sell the formula to do good…

Doesn’t sound like much, unless you’re a billionaire; and normally they don’t give you their formula, but rather make donations and that’s it.

And what benefit does an advisor give versus doing it myself?

So, a study conducted by Vanguard shows that: An advisor who looks out for your interests above all else is a good advisor.

It can improve your performance by more than 3% year-over-year, so that’s a professional who’s trained for it and does it all day.

There are things that we can do ourselves and hence the success of companies such as IKEA or Homedepot, where they promote the culture of DIY (Do it yourself).

The reality is that not all of us have the facility to assemble a piece of furniture or fix something in our homes, I say this from my own experience!

But one thing is that the furniture in the room has been a little crooked and another thing is that your family finances are lost.

Because it is the family’s heritage and because of how complex it is to make money and maintain it.

Credits: Magisto

So we consider that there are two things that should not be done by ourselves:

1) Health and

2) Manage family assets, without support.

Because the reality is that not even the best surgeon should operate on himself, since there are always feelings and decisions that will not be rational.

But all advisors are the same, right?

Yes, you may be right. But every time I try to find a financial advisor I get people looking to sell me something or a product.

In other words, most people are not exactly interested in my Financial Well-being, but let’s remember that there are two types of financial advisors:

1.The seller of products:

I will explain this to you with an example: imagine that a doctor tells you “I have the solution to all your ills”.

But for them you have to buy a medicine that I produce. With that sale the doctor may earn a lot of money regardless of other factors.

That is, regardless of the fact that there are other remedies with the same efficacy and prescription, but much cheaper. Therefore, your advice is not being objective.

Consequently, they seek their personal benefit and not yours. The bad news is that most of them are like that, the good news is that this has been changing.

Credits: Magisto

Let me share a personal story about this type of advisor:

When I entered the University, I had a friend who sold financial products and said that they were the best of the best companies in the world.

Even that they produced the highest yields, claiming that it was safe and there was nothing better.

At that time, without sufficient knowledge, I felt that I could not miss the opportunity to invest, since it was sold as something extremely exclusive.

I finally made it, I invested almost everything I had and years passed and the super product, mega exclusive ended up being only ultra good for my friend.

In addition, he earned a large commission by selling it to me, from there I said “this is wrong”, how is it that the advisor earns more than the client who is the one who puts his capital at risk.

Credits: Magisto

2. The real adviser

It is the one that will understand what is best for you, and will offer those products that are economical so that it is better for you.

Also, regardless of whether he belongs to financial group A or B, because he does not work in any of those banks and his bonus does not depend on him selling it to you.

It is there where you will be able to choose what is best for you and not what your boss asks you to sell.

Credits: Magisto

How do I determine which advisor is right for me?

Now, since you know if there are two types of financial advisors and that we are not all the same, the issue is how do I identify them and for this we suggest using the following questions:

What are the commissions that I will pay when investing with you?

Do you receive a commission or direct benefit for selling me this product and if so, will it cost me more as a customer?

And if you ask the questions in writing and not just in a much better conversation.

Our suggestion is that, if you are going to self-medicate financially, be very careful and that it be for simple things like a small financial headache.

But if, on the other hand, you really want to improve your finances, it is there where, as in all cases, it is always better to support you with a professional, but who, as we have seen, seeks the best for you and not only the best for him.

Alonso Rodríguez Segarra
Alonso Rodríguez Segarra
Founder & CEO Advise Financial advise-financial.com Alonso Rodriguez Segarra is a “CERTIFIED FINANCIAL PLANNER™” named by Investopedia among the Top 100 Financial Advisors in the USA  with more than 20 years of experience. His specialty is helping those people who want to plan for their retirement or optimize their retirement, with Hourly Financial Planning always looking for the best for his clients, under fiduciary criteria.

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