What can you expect from a financial adviser?
What is the difference between a tax deduction
and a tax offset?
Insights into Successful Investing —
Seek Advice — Part One
If senior executives, sports stars, politicians and entertainers all get expert help to manage their money, why shouldn’t you? There are many reasons why it makes sense to seek advice. Some are just common sense.
In an increasingly specialised world there are an ever-increasing number of experts we call on to help us. If you listed the experts you consult every year it would probably include mechanics, accountants, doctors, dentists, pharmacists, optometrists, travel agents and gym instructors. Even sports stars rely on expert coaches to remain at the top of their game.
Why do we rely on these experts? Because they are trained to do certain tasks that we are not – book flights, fix teeth, devise a fitness program, fit contact lenses etc. That training means
that we can rely on them for advice and services that make our lives better and easier. It’s no different with managing our money.
Given time, a certain amount of natural talent and a lot of training, we could do a lot of things that we pay others to do. We could spend time researching nutrition, learning biomechanics and anatomy and devise our own exercise program. Or sweat over books till we knew enough of the latest tax laws and accounting legislation to do our own taxes. The reason we don’t is that it’s inefficient. It’s more cost effective – in time and money – for us to specialise in what we do best and use other experts when we need help.
Tiger Woods makes a lot of money from playing golf. Which is the best use of his time and energy? Learning international tax law or improving his putting? Researching investment products or practicing his bunker shots?
Insights into Successful Investing –
Seek Advice — Part Two
What do you get from your financial adviser?
So what are the most important services you get from a financial adviser?
A holistic approach
A financial adviser can help you take a holistic approach to your finances. They help you to understand your existing financial position, clarify what your goals are and devise a strategy to help you achieve them. Most importantly, they build a financial plan that is about YOU – your age, your plans, your investment experience, your risk tolerance and your lifestyle.
That means that all your financial decisions fit into a logical framework and that the products and services you choose work together to meet your needs.
Asset allocation is the art and science of allocating your investment between shares, property, bonds, cash and other asset classes. Many different experts believe asset allocation is the single most important investment decision. https://taxaladin.com/
Your financial adviser can work with you to devise an asset allocation structure that suits you, helping you use the mix of growth and defensive assets that meet your needs. Ongoing
consultation with your adviser also helps you to stick with your asset allocation strategy in the face of short-term events, such as the tendency to become too defensive when markets are falling or too aggressive when they are rising.
There are literally thousands of shares, managed funds, trusts, super and retirement income products to choose from. Which is best for you? Your financial adviser has access to the latest professionally-compiled research that allows them to compare these products against each other. That means they can choose the best products for you both in terms of performance, fees and in terms of quality of management and how they fit into your portfolio.