Specifically,the one where I believe that many people do not need a financial adviser. In fact,I think many people should not be working with a financial adviser … yet.
Financial advice can seem like a maze to navigate,and much of the time,you don’t really need it.Simon Letch
Unsurprisingly,this ruffles the feathers of many professionals,but let me clarify.
I’m not anti-financial advisers. In a professional context,I’ve worked with several advisers,who all had high integrity and a desire to make a difference in the lives of their clients.
So,I’m not saying there’s anything wrong with financial advisers. What I’m saying is that many people aren’t at a stage where a financial adviser would be the best way forward.
What many people don’t realise is that financial advice originally was an industry that focused a lot on helping customers understand (and buy) financial products. So,the goal of financial advisers used to be to recommend (and sell) you financial products (e.g. insurance policies,super funds,investments etc).
There is work you should do before you walk into a financial adviser’s office.
Nowadays,this has changed,but even so,this historical context means that the way the profession has been designed (including the business model,and training requirements) means that there are certain things that a financial adviser might not be the best option for.
Today,I want to share some insights on when it might be useful tonot see a financial adviser and what you might benefit from focusing on instead.
1. Learning ‘how to save money’ isn’t the best use of a financial adviser.Will financial advisers talk to you about how to save money? Sure some of them might talk about how to organise bank accounts and set up a budget or a savings plan.
But in truth,learning how to save money consistently isn’t about having a plan on paper. If you’ve ever drawn up a budget that you gave up on two weeks later,you know this.
I know from experience that helping someone learn to save money requires a lot of psychological and behavioural change. This isn’t something advisers are really trained in.
Many advisers prefer to work with clients whohavesavings and want advice or a plan for what todowith those savings (e.g. invest). This is partly because people who don’t have savings typically can’t afford the services of a financial adviser in the first place.
If you’re a low-income earner,you might need to find ways to increase your income and cut expenses where you can. If you’re not a low-income earner,and you’re still struggling to save money,you need to re-evaluate your lifestyle,values,priorities and goals.
2. If you’re terrified to invest,a financial adviser might not be the best place to start.This is going to sound counter-intuitive because investing is absolutely within the scope of what financial advisers do. In fact,it’s often their bread and butter.
So yes,they can absolutely design a portfolio for you and recommend specific investments for you to invest in,based on your personal goals and circumstances.
But I’ve worked with many people who have not only zero understanding of investing,but a negative understanding of investing. Meaning,they have numerous misunderstandings about how investing works. These misunderstandings also breed a lot of fear.
In my experience,when people have that much fear and lack of understanding of investing,there is a psychological and emotional journey they need to go on before they can open themselves up to investing. Having a well-designed plan on paper is not enough.
Without that openness and receptivity,even if you go ahead and invest for such a person,you risk this person being highly reactive and making emotional,panicked decisions.
Now,financial advisers will try to help you past this,but unfortunately they often have a limited amount of time to spend with you on this process. While they may spend some time explaining the plan to you,if you have a lot of resistance or fear around investing,this may not feel like enough. It may leave you with more questions than answers.
You are better off spending some time learning the basics about investing,so when you walk into that office you feel a little more confident,you can understand the advice being given to you,you have the capacity to ask good questions and hold your own in the conversation.
In both above scenarios,you’ll notice I’m not saying a financial adviser is a bad idea.
What I’m really saying is there is work for you to do before you walk into a financial adviser’s office that will make working with them a more valuable experience for you.
Paridhi Jain is the founder of,which helps adults learn to manage,save and invest their money through financial education courses and classes.
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