With terms such as bulls and bears, it?s no wonder that the world of financial planning is often described as a jungle. Like any jungle, it is a dangerous place for those who lack experience — which is why it is vital to hire a professional financial planner as a guide to see you through safely.
The rationale for engaging the services of a professional planner is as follows:
1.No matter how much you learn about investing and mutual funds, unless you do it for a living you won?t be able to keep up with the ever-changing details.
Financial planners, like other professionals, spend all of our time studying our profession — this means the financial markets. This involves a continuous education program to keep ahead of both social and economic changes that are constantly taking place in today?s fast paced financial environment.
2.You need an objective opinion.
You?ve heard it before elsewhere ? doctors don?t operate on family members, lawyers don?t represent themselves. Why? They?re too close to the patient or client and can?t remain unbiased and objective.
If you are going to get the greatest benefit from your investments then you have to eliminate all emotion from the equation. There is no room for error in investing. All too often financial planners see people that are all caught up in the hype of the moment and as a result make very poor financial decisions. This is usually a result of a media feeding frenzy. Many people bought Nortel Shares at $100 + and then couldn?t bear to cut their losses which resulted in them losing considerable portions of their principal as these shares dropped to a low of $0.64 cents. A professional financial planner could have prevented this error simply by explaining what was happening in the market and helping to take the emotion out of the equation.
3.A professional financial planner will give you a better grasp of concepts, relationships and options.
Planners posses valuable experience leading others through this financial jungle, furthermore, we can point out shortcuts and pitfalls, and suggest sensible tradeoffs that can help you pursue your dreams and make them a reality.
When looking for a financial planner it is important to seek someone with whom you can establish a relationship built on complete trust. You will be asked to divulge a lot of personal information about your financial and private life. Remember that we are there to assist you in setting and obtaining realistic financial goals, and that all information disclosed to a financial planner will be kept in the strictest confidence.
4. Following are a list of tips for helping to select a financial planner that is right for you.
·Begin by asking friends and colleagues for referrals. Talk to people who are in similar financial and personal circumstances
·Attend seminars ? they?re usually advertised in the financial section of daily newspapers
·Interview your candidates
·Ask questions i.e. what services they offer and what their investing philosophy is.
Remember that once chosen you will likely be entering into a long-term relationship with this person so it pays to do your homework. Your financial advisor will be your guide through the jungle. Call him or her whenever you want helpful insights, and make sure you and your advisor hold regular meetings to review your portfolio and financial objectives. Once done you will find that a financial planner chosen correctly just may prove to be the most prudent financial decision that you ever made.