I have stated multiple times before in articles that I am not the biggest fan of financial advisors, not because I believe they are inherently bad people, but because I know they have to make a living, often at your expense. In order to survive as a financial advisor you often have to pitch investments that might not be in the client’s best interest but will make you commission. This is why there is such a fast turn over in their industry and why certain people cant do it for long periods of time. If you don’t want to get taken advantage of, the key is to learn something yourself.
Financial advisors basically work by getting as much people going to them as possible and making a tiny portion of their portfolio something undesirable like annuities. However because the financial advisor is making them money in the long run, they end up loving them and building a relationship. However, 99% of the time, if you had just taken your money and put it in an index fund you would have more money in the long run. I have done this test with many of my friends and their parents who rave about “their financial guy”.
In addition many big time financial advisers who are making money hand over fist and charge large hourly rates to meet with them, will position themselves as pillars of the community. They will go to a church, town meeting, ect and get clients as much as possible. It’s not a total scam, but like I said before, you would end up doing much better if you had just dealt with your money yourself. Advisors do have a use case when it comes to help organizing certain account and tax purposes, but I wouldn’t let them invest your money in most of the cases.
The real lesson here is that with money, you cant afford to not learn about finance yourself, or else you will get taken advantage of. People are out there to take every little penny they can at your expense. Most people never realize it is happening either, but in the long run they might be costing you thousands of dollars. Learn about index funds, how stock market ETFs work, just personal finance in general and you will be glad you did. If you are younger, it is imperative that you learn at a younger age. The faster you start investing, the more you will have for your retirement. It is never too early to start, especially when the stock market has doubled money on average every 7-8 years over a 60 year period.
If you are looking to start learning about personal finance and have no idea where to start, there are many people who I do believe are very good. Suze Orman and Dave Ramsey, I believe might be a good start for a complete novice. They don’t really take any risks with any of the money, but they do teach you a good basis. If you are looking for other research, there is a fantastic subreddit r/personalfinance, which has a ton of material and people that are willing to help you out. You can ask them specific questions as well and they will respond. This is your money that we are talking about, money you work hard for every day, don’t let a parasite skim some of it from you.
Thanks to @Elyaque for the badges