Mike Coady - Coady Performance Group

When it comes to seeking financial advice, investing in a financial adviser should be exactly that – an investment.  In the same way as allocating funds for your children’s future education or buying additional property is an investment, the saying of ‘you get what you pay for’ can certainly be a considerable factor both positive and negative when choosing a financial adviser.  However, is there a possibility you could even be paying too much for financial advice?

The simple answer is yes, but I would say this is often more typical from a “transactional” adviser that ends up positioning a product or 2 into your overall strategy and the relationship, both initial and ongoing, is centred around the products that were distributed or simply dispatched to you.

Should you look into going ‘Robo’?

As mentioned in a previous article , the ‘Robo’ approach to financial planning uses computer-generated ‘Intelligent Portfolios’ to manage clients’ investments.  Although the movement towards an entirely automated adviser industry is not news, new software solution products are being launched all the time, with the aim of reducing costs for investors.

How effective is ‘Robo’? And could opting for software-based financial advice really be worth it?

The short answer may often be yes for transactional based advice.  Although investment management using an automated computer-based program will potentially cost less to begin with.

However I expect much more now from advisers in 2018.  Gone are the days of just knowing your products, and a library of case studies and outcomes.  What I expect from today are advisers that are highly skilled in coaching, mentoring and at naturally at home with creating an overarching vision and strategy for their clients.

A highly personalised relationship is far more beneficial than just software when it comes to your financial vision, family mission and strategy.

Below is a list of the primary advantages of choosing a financial adviser over just a computer program:

  • Your adviser is always on call to answer your questions—no matter what those questions are or when you think of them.
  • Your adviser understands your specific short-term, medium and long-term goals. Because we know you, we know what you want and need to achieve those goals. Software cannot make decisions based on emotional or long term strategies that are not number related.
  • We should be able to motivate you. The only way for software to work effectively is to tell it what you want it to do. Over the course of any given year, many of our clients change their mind because of fear or a lack of investment motivation. Software cannot motivate you to stay on track and achieve and protect your goals.
  • We highlight the risks and we encourage you to take action.
  • Unlike ‘Robo’ services, we can help you with often complex tax efficiency, especially where multi jurisdictions are involved.
  • We adapt advice to your individual situation, change your mind, and help you see other concepts or ideas. We explain why you should do specific things. Unlike a software program that just tells you what to do based on code, we engage you in making decisions that benefit your unique needs.
  • Advisers individually work with hundreds of clients. That gives them a lot of experience. We know the market, what’s happening, and what it means to you—not just locally, but worldwide.
  • Most importantly, we’re a partner that you have by your side as a mentor through all of your investments.

I believe each financial advisers’ main focus is providing an exceptional level of service, not just automated investing.  Although you will pay more for first-class advice, in the long term you will reach, and often exceed, your financial objectives with a committed, understanding, highly-skilled team by your side.

The most important is finding an adviser that can direct and upgrade you.  Ask yourself, if you want a fitness trainer or a tennis coach – what would you expect from them?   You expect a fitness trainer to be living and breathing their instructions, so take the same approach with your adviser selection.  If they can’t coach themselves on financial wellness, then on what authority do they coach you.

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Blog published by Mike Coady.

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