When is it time to hire an investment professional? For some, it may be when they have a lot of money, for others it may be that they haven’t got much at all but are getting serious about saving.
There is a growing need for financial knowledge as we all get closer to that moment when our earning power deteriorates and we must live on what we have invested. There is no shortage of folks that would like to tell you how to get ahead, and along with that, a tidal wave of confusing double-speak.
So, how do you know what YOU need? I’ve designed a few questions to help you think through your situation and decide it you wouldn’t be better off asking for help. Investment advice can be expensive, but not if you really need it and it helps you meet your goals. Start by asking yourself these questions:
The free investment advice runs from being very valuable to absolute trash, can you tell the difference? Expensive investment advice runs from being valuable to absolute trash, can you still tell the difference? Knowing how to find hidden fees is absolutely critical. Know how much it really costs you to invest!
Are you a woman? Studies by several groups have consistently shown that women outperform men when they invest. The various studies have looked at both individuals and investment groups. There are several theories about the reasons why, but I prefer to just let you bring the subject up at your next social gathering and see what people say.
Are you in an investment club? If you enjoy investing, continue to learn about investing, and are open minded enough take advice from other people with similar goals you will more than likely beat the pants off the professionals over the long run. Studies show that disciplined individuals often outperform the broad market when they know what they are doing and control costs. Smaller investors are like speed boats next to the behemoth mutual funds that are trying to buy and sell stocks.
Are you too conservative or nervous? On the other hand, there are many more investors that aren’t interested enough open a brokerage account and trade their own stocks. The news is grim indeed if you’ve been sitting in CD’s for 10 years or if you are still too wounded from the tech-bubble of 2002 to get back on the investment horse.
Do you know how to measure your performance? I don’t mean can you calculate your return to the nearest millionth decimal place. It isn’t enough to shoot the finest arrow ever made if it’s pointing in the wrong direction. There are plenty of free tools available to help you determine if your savings plan is on target, but don’t forget to include the eroding effect of inflation. If you are the type that gets a Christmas Club account every year and always has plenty to spend on your loved ones, skip to the next question; if your plan includes crossing your fingers and jumping into the unknown, you probably need some professional advice.
Are you a spontaneous romantic? Get an advisor- we’re boring but we can really provide a service when you hate going to your ‘spreadsheet place’.
I heard on the radio this morning about a woman with 19 credit cards - $21,000 in debt – no job, on disability, three kids, husband out of work. How bad can it get.
