Why do you need a wealth advisor?
After all, it’s your wealth and you can manage it better than anyone else, right? Well, not so fast.
Why do you even need help from a professional wealth advisor?
Even though financial advice costs around 0.5-1 percent, very few individuals or business hire them. Hiring them is actually beneficial when you need high returns but not every business hires or even needs them.
According to a study by Astra Wealth Advisors, private investors obsessively follow the market trends and enjoy investing.
This is only one-quarter of investors who are actually self-driven whereas the rest are not self-directed towards investment.
This is probably because they know about the benefits they can receive from their help. Your investment can actually have some value if you take help from wealth advisor.
Check out the benefits of hiring a financial or wealth advisor
After knowing benefits of hiring their financial advisory services, you will actually search for one.
Lack of objectivity is the real cause behind poor performance of the portfolio of your investment.
Your investment decisions should not be based on emotion especially feelings like panic or worry.
This will wipe out all your hard years of work. If you cannot trade emotion free or face difficulty while making an investment then take help of professionals.
They will give you objectivity and let you make a decision based on your objective. They will work with you or take decisions on your behalf.
- Full time professionals
Full time Professionals like Astra wealth advisors have experience of years in offering training on wealth because of their vast knowledge and qualifications.
Achieving such experience and knowledge on your own is impossible or difficult. They have a degree in financial advisory and have gone through various industrial training programs to achieve a competency and accuracy in providing help related to market developments, taxation and law. Moreover, their years of experience working with management professionals and investors are something that an individual cannot have just as soon as they come in the market.
While making an investment one should be careful as the investment opportunity that looks perfect may cause a heavy taxation.
It will hurt your investment returns as well as personal income.
Don’t worry, as tax related concern will be taken care by the financial advisors. They will ensure that proper tax are implemented and also advice you how to reduce tax, changes related to taxation, long term investment with large gains and more.
Research is important to get the best investment opportunities which need lots of time.
They do regular research to ensure that their clients are making investments in right direction. So, no need to stress you with research part instead takes their help.
Perhaps the most important benefit is a chance for relaxation. You can simply sit and relax once you get the right advisor who can take care of investment, challenges and returns.
No need to stay close with the market trends simply discuss with your financial advisor.
Despite these advantages, one question still troubles the investors. How much will it cost?
The fee rate differ for different advisors so this make the selection a bit challenging. But, few things can make you understand how the financial advisor charges.
Understand the fee structure
Registered investment advisors like Astra wealth advisors charge in one of the five ways given below.
- Assets percentage– financial advisor charge on the basis of assets in your account
- Hourly charges– they may charge you on hourly basis for any special consulting or a project
- Fixed fees– some financial advisors have fixed fees for their services
- Commissions- they make ask for a commission for a trade or purchase on the success of their financial plan
- Performance based fees-they may ask fees on the basis of their performance on achieving a set benchmark
You may be charged in one or combination of these ways depending upon their services.
However, advisors who take only fees don’t ask for commission for any trading securities or selling products. Some fee based advisors take both fees as well as commissions from their clients.
Know about that extra cost
There is also an additional cost of hiring financial advisor that include third party fees. This includes cost related to mutual funds or ETFs.
So, it is very important to know whether there is any extra cost associated with their services or not.
Knowing about the fee structure is essential before you begin working with them. Ask them to explain their fee structure for their services and programs.
In case they don’t give a steer clear answer watch out as this implies that there may be a hidden cost. Also, ask them about their source of compensation or commission. Check out their experience in working with professionals or in tax related work.
How to minimize the cost?
Thumb rule is to hire a robo-advisor because they charge less in comparison to traditional advisors.
Their fee is as low as 0.25-0.89% whereas traditional advisors take 1-2% of your assets under management.
But, if you seek to take help from traditional advisor then choose a fee only advisor because they have a simple fee structure. Also, you can negotiate with them to minimize the cost or fee rate.
Tips to pick up a best financial or wealth advisor
- Check your needs and then search for an advisor
- Don’t settle for one so easily, check out few more as it is about your trust and money
- Ask for the cost or negotiation
- Ask for their services
- Check their qualifications and credentials
- Ask for a sample financial plan
- Ask how often they review their plan
- Know their investment philosophy
These tips and questions will clarify about your needs and their professional experiences. Once you are satisfied, hire them and get your assets managed by the professionals.
To read more on topics like this, check out the money category