Finance Professor Explains: Should you pay a financial advisor?

A financial advisor can help manage your money but is it worth the expense? With the simplicity of ETFs and index funds, a financial advisor may be unnecessary. To make the most amount of money for financial freedom forever, you want to keep your profit. This video outlines the pros and cons of a financial advisor and why you should or should not have one!

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[NolanGouveia]

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[jdgolf]

I had a nephew once that had some money he wanted to invest, and really didn't understand investing, so I went with him to an advisor, just to talk to him. After all the talk, his goal would to match the return of the s&p 500, fo a fee of 1%. So, not trying to be mean or anything, I asked, "wouldn't you need a return of 1% greater than the 500?" After the meeting, I showed my nephew s&p 500 index funds that he could invest in, that cost practically nothing! In the end, that's what he did. I think most average people go to financial advisors because they have nobody to show them how easy investing can be.

[rosst]

Professor G-
Im in my early 50s
Ive been a voracious YouTube financial video watcher since the pandemic, and I’ve recently just found your channel.

After watching a couple of your videos, I decided to go back and watch almost every video you’ve made tor close to the last 12 months.

You’ve truly changed the way I’m looking at investing. You’re personally responsible tor persuading me for trading in my 36 stock portfolio with little to no etfs to a safer, more balanced approach with your strategy of foundational, dividend and growth etfs with maybe ten favorite stocks to supercharge the returns.

Can’t thank you enough for truly simplifying investing for me !!!!

[rynewilliams]

Great video professor! Financial advisors are kind of like the personal trainers of the finance world. Some people would just rather have someone come up with a workout plan for them so they don’t have to think about it, and that’s a good way to go for some people.

[mohamadalrifai]

I am a Staff Accountant and work in a CPA firm. We reconcile stock portfolios for corporations and also file personal taxes for individuals with huge portfolios. You cannot imagine what i see every day of fees taken out of their wealth [as a percentage of their profit/gain] -Not to mention that these profits/gains will still need to be taxed [up to 50% for corporations and 53.5% for individuals]. In short ... management fees are like being a 50-50 partner with the porfolio owner.

[knowledgeseeker]

Really good video for beginners and people who don’t understand impact of portfolio management fees

[sasesinghan]

I might use an FA for fee-for-service planning in the next few years for tax and estate purposes, but never again use an FA for my investment goals again. I will teach my child how to invest properly and save those fees.

[billsteffey]

What I like about M1 is you can make a pie and put in your lazy portfolio of ETF of subclasses. Then if you want to put in sector funds or stocks or crypto you can put this in a small percentage of your portfolio and boost your returns with little risk. I put 90% in a lazy portfolio then 10% in whatever I want and it boost the overall returns of 2%

[ByteSizeMoney]

You did a great job of articulating exactly how I’ve always felt about the financial advising industry. In most cases, I really don’t believe people are getting enough value for what they’re paying. Educating yourself on investing is free and the return on that is unbelievable.

[VanGoghGlobetrotter]

Thanks to your channel and a few other informative and reputable ones, as well as the advent of ETF’s and user friendly investment platforms, I feel like we have a great deal of excellent information and resources available to us that had previously been much more difficult to obtain! Thanks for what you do! 😊

[Kamdorian]

You sir, are my free financial advisor 😂 I almost got suckered into using a FA that was charging 1.5% then I said ef that and came on YouTube and found you!!

[andreacharles]

I have a financial advisor calling my phone a few times a month so far i have ignored him. Good to know i am doing the right thing since i can manage my portfolio and keep learning.

[robshelton]

Thanks for another thought-provoking video! I've gained most of my knowledge about investing from youtube videos and self-directed research. AND-Because I manage 3 different portfolios for my family, I
often seek confirmation for my decisions (I have a lot riding on my shoulders).While I've demonstrated the ability build basic 3-5 fund portfolios, much of my anxiety/doubt is caused by the overwhelming amount of information I have attempted to absorb over the last few years (and what to do with that information) regarding topics like: "large-cap to small-cap rotation, tax-loss harvesting, and the pros/cons of rebalancing a portfolio".
MY QUESTIONS ARE:
1) As an investor trying to cushion retirement pension(s), should I be concerned with such things as rotations, rebalancing, & tax loss harvesting, etc???
2) IF SO, does a limited amount of knowledge about s uch things warrant the experience of a financial advisor?

[seanharrington]

Make sure ANY financial adviser has the heart of a teacher and explains what he offering. Then YOU make the decision on what investments best align with your goals. Lastly--make sure your financial adviser is a " Fiduciary" when it comes to managing YOUR money !!!

[acilirp]

This video is gold! Professor G just validated me. Today my coworkers were talking about their financial advisors and I was the only one w/o one. I started inquiring about their investments and if the financial advisor discussed the MAGI before investing in their IRAs and the answer was "NO!". They looked at me like I was crazy for doing it myself and l looked at them like they're crazy for not knowing how their money is being managed.

[randy]

Oh hell no, think of it this way:

"But research suggests the services aren’t always worth the extra cost.

If you’re not willing to put in the time to provide personal information, “it’s like paying an ongoing fee for a gym membership you never use, ” said Ben Taylor, a consultant at Callan."

Unless they are providing tax, estate, and investment advice in the fee, it's not worth it. If you need help, just pay a fee only advisor for your "specific" needs. An RIA for investments/financial planning, a CPA for taxes and an Estate Lawyer for Estate Planning.

[enlea]

Having ETFs like VOO, VIG, and SCHD available really feels like a hack. Amazing returns for dirt cheap!

[todaynottomorrow]

Would you pay your accountant? Would you pay your attorney? Would you pay your tax advisor?

Hows International outlook vs S&P next 10 years? Living trust vs Will? Roth conversion executed with no tax liability?

Or Go solo and hold through 6 crashes, 4 recessions, job loss, tragedy, turbulations, kids, , and never make an emotional mistake....? Or pay the expert

[punisher]

I'm a fan and avid watcher hailing from St.Louis County.

[bamacaveman]

I gave Edward Jones the boot last June and do not regret it!
By the way I really enjoy your videos!