Do you use a financial planner or organize and plan your finances yourself?
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 All Forums >> [Life] >> Finances >> Do you use a financial planner or organize and plan your finances yourself? | Page: [1] |
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Do you use a financial planner or organize and plan you... - 5/12/2008 9:18:24 PM
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raspberry331
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Do you use a financial planner or organize and plan your finances yourself?What are the pros and cons of both of these?
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RE: Do you use a financial planner or organize and plan... - 5/13/2008 12:47:57 PM
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NoShow
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I do it myself. I honestly haven't met a financial planner that's been able to help me more than I help myself.
Pros: Cheaper. Custom fit for my specific needs\situation.
Cons: Have to stay current on many topics.
I imagine for some people an additional Cons might be things like, making decisions while ignorant (not (well) informed) in some areas and making decisions from a biased view. From numerous discussions with others, I believe I'm not doing either.
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RE: Do you use a financial planner or organize and plan... - 5/14/2008 2:45:58 AM
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bzirk
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quote:
ORIGINAL: NoShow
I do it myself. I honestly haven't met a financial planner that's been able to help me more than I help myself.
Pros: Cheaper. Custom fit for my specific needs\situation.
Cons: Have to stay current on many topics.
Ditto.
I will add that I do seek counsel from numerous sources, but I do not have a single financial adviser who directs all of my investments.
< Message edited by bzirk -- 5/14/2008 2:52:40 AM >
_____________________________
Therefore, there is now no condemnation for those who are in Christ Jesus (Romans 8:1)
Great quote: I just ain't God and don't know it all. -- SonInMe1
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RE: Do you use a financial planner or organize and plan... - 5/14/2008 7:29:32 AM
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P31W
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We don't have a single individual rather a team of professionals. Of course "they" hold no power. We take in everything they advise us and make the final decisions ourselves.
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RE: Do you use a financial planner or organize and plan... - 5/14/2008 10:55:12 AM
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bzirk
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That's pretty much what we do. As far as professionals go, I always include a good CPA and a lawyer in the bunch. If I had to limit it to only one of those, the lawyer would have to go. 
_____________________________
Therefore, there is now no condemnation for those who are in Christ Jesus (Romans 8:1)
Great quote: I just ain't God and don't know it all. -- SonInMe1
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RE: Do you use a financial planner or organize and plan... - 5/15/2008 1:25:16 PM
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lexie
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Currently, we do everything ourselves, and I'm not sure if we ever will use a financial planner.
We don't invest in stocks, just in GICs, as well as Dd's RESP and our RRSP. Dh has a pretty good understanding of how all that works. My father is a tax professional, so he helps us if we have any questions.
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RE: Do you use a financial planner or organize and plan... - 5/20/2008 10:03:41 AM
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imit8him
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Hi Raspberry,
This is a wonderful question and also a commonly difficult and confusing one to understand and answer for many people out there, so I'm glad it's been asked here. I personally manage my own finances (because I have experience in the financial industry), but would also not be opposed to having a very good financial advisor work with me if I had a large sum of assets and did not have the time or interest in handling them.
The answer to your question, though, is very much dependent on various factors. The three main reasons/potential client types for seeking out and needing (someone who would benefit significantly from) a financial advisor are:
a.) Someone with very little education and an inability to properly handle their own finances. (In this case, it is all the more important to find a trustworthy and qualified advisor, given how many bad and predatory ones there are.)
b.) Someone who has the education and know-how or ability to learn the financial planning process, but is too busy and/or uninterested to do his or her own finances (much like taxes...a lot of people can do them, but are too lazy to bother with the hassle...going to a tax accountant is convenient, so same with a financial advisor).
c.) Someone who has the education/know-how and has the ability to learn the financial planning process and even wants to do it, but simply cannot, because their asset base is too large and complicated to handle by themselves. (This is a rare case, but usually involves very rich clients, who may be very smart and educated and even have a decent knowledge of the financial industry and an interest in it, but because their millions, if not billions, of dollars is too much to handle, they seek out a team of advisors who are very qualified. Often lawyers or businessmen do this, but they go to the very best firms, such as Goldman Sachs, who charge very high fees.)
The middle ground of people excluded from this list of those who would significantly benefit from a financial advisor are those with an education and ability to learn the financial planning process themselves and who have the time and interest to take care of everything. I actually recommend that most people do this (just like with taxes) if they can, because it saves so much money. And unlike the tax field, where there really aren't any "sleezy" tax accountants (though some are better than others in terms of skill), the financial advising industry is very much inundated with bad advisors and predatory salesmen-like people who are only interested in taking all of your money and meeting their company sales quota. With a bad financial advisor, you can literally lose all of your investment savings, if not more assets, due to greed and/or recklessness and negligence. For the most part, I think if you can take care of your own financial planning with a little help here and there from others (maybe ask knowledgeable friends or even work with a few advisors every now and then - since some of them charge only per visit fees), then it is well worth the effort. And again, unlike taking care of your car...or taxes, or something else that we pay others to do, financial planning is kind of a unique industry of its own and has many pitfalls that can cost one much more than a tax penalty (maybe a couple hundred dollars) or a leaky oil tank (maybe just a rare mechanic error that can be easily fixed), but can cost you your entire personal financial portfolio. And there are many stories of people being bilked out of all their assets from listening to bad financial advisors. So if you can and are willing to take some time to learn the basic financial planning process (something that may take time, but is worth it), you are usually better off doing your own planning. One other general suggestion that I have done myself is to work occassionally with advisors, but not necessarily have a long-standing obligation to one (unless I fit those three categories above or simply found an outstanding one)....This may be difficult at first, because most companies put relentless pressure on advisors to create long-lasting relationships with clients and this may very well be difficult to get out of if you've got complicated long-term investments or arrangemetns with a particular advisor. Switching firms can take time and is a pain. But if you can somehow do your own planning and go to maybe a pay-per-visit type advisor without any pressure of long-term obligations (even then you can just refuse), that'd be another way to handle an ideal situation.
(Personally I believe I have the ability and interest to do my own financial planning, but like I said, it can still be beneficial to seek out a trustworthy and qualified advisor every now and then for help...It costs a lot, but that's just the price you pay for good help.)
Now in terms of more specific pros and cons and the details of the financial planning industry and process, I'll need more time to address those (it's long, but still simple enough). I actually have a great interest in this area, so I like talking to others about it. ....I'll follow up this post tonight with more specifics. I need to take care of some work errands. 
Great question though!
-Imit
< Message edited by imit8him -- 5/20/2008 10:18:08 AM >
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RE: Do you use a financial planner or organize and plan... - 5/20/2008 10:31:58 AM
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bzirk
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The problem with finding a financial planner is indeed that a significant number of them have something to sell. I didn't say all of them but enough of them that it's an issue when considering a financial planner.
_____________________________
Therefore, there is now no condemnation for those who are in Christ Jesus (Romans 8:1)
Great quote: I just ain't God and don't know it all. -- SonInMe1
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RE: Do you use a financial planner or organize and plan... - 5/20/2008 10:34:03 AM
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NoShow
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quote:
ORIGINAL: imit8him
a.) Someone with very little education and an inability to properly handle their own finances. (In this case, it is all the more important to find a trustworthy and qualified advisor, given how many bad and predatory ones there are.)
This is one of the biggest problems that I see\come across; how is someone with little education concerning finances, expected to be able to determine which are the trustworthy and qualified advisors?
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RE: Do you use a financial planner or organize and plan... - 5/20/2008 10:56:22 AM
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bzirk
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Caveat emptor, "let the buyer beware." This old adage needs to be the order of the day. It used to be, and those were the days when the norm was not to grant trust where it wasn't due -- education or no.
Common sense (or what used to be common sense) needs to reign in these situations. If people don't have the background sufficient to make a decision, they need to let their natural wariness take the lead. Or to put it really plainly -- it's always important to remember that when you're doing business with someone they are not doing you a favor. They have something to gain. They have a vested interest. It's the buyers job to discover what it is. No one has to be educated in financial matters to approach transactions with that wariness.
_____________________________
Therefore, there is now no condemnation for those who are in Christ Jesus (Romans 8:1)
Great quote: I just ain't God and don't know it all. -- SonInMe1
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RE: Do you use a financial planner or organize and plan... - 5/20/2008 11:05:58 AM
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P31W
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I suggest "fee only" planners who have a good past track record.
Something else they can do is make friends with people who do know about money. I bet at least once a day someone will call me or my husband and tell us what some lawyer, broker, advisor, fp, accountant or so on has advised them to do.
Something we tell them to "go for it" sometimes we tell them to fire that nut other times we tell them to contact another person we know who knows more about the subject than we do.
Not only do people call us often but we have a group of diverse wise/ seasoned/experienced guys we call for advise or info.
< Message edited by P31W -- 5/20/2008 11:14:59 AM >
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RE: Do you use a financial planner or organize and plan... - 5/22/2008 11:06:22 AM
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JazTek
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My planner is my wife... She's an accountant... I don't touch the finances ! 
_____________________________
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"As for me and my house, we will serve the Lord"...
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RE: Do you use a financial planner or organize and plan... - 5/24/2008 1:44:32 PM
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trainfan
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I own my own business and use a financial planner for retirement accounts but that is all. I do the rest of my investing on my own.
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<---- The dog smiling.
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RE: Do you use a financial planner or organize and plan... - 5/24/2008 3:57:49 PM
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mrtigger
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quote:
ORIGINAL: bzirk
The problem with finding a financial planner is indeed that a significant number of them have something to sell. I didn't say all of them but enough of them that it's an issue when considering a financial planner.
Yes that is my perception as well...
And even worse are the ones who are outright crooks.
I can't tell someone with good objective advice from someone who is selling me something from someone who is actually intending to rip me off.
I may be stupid sometimes but at least I can trust that my own decisions are intended for my benefit.
_____________________________
mr tigger
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RE: Do you use a financial planner or organize and plan... - 6/17/2008 1:26:50 PM
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imit8him
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Rasp, I had forgotten and put off getting back to you on this one. I have a lot of things I'm dealing with, but let me get back to you by Wednesday night (I'll have the whole night off).
Blessings,
-Imit
< Message edited by imit8him -- 6/17/2008 1:33:29 PM >
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