While it can be tempting to automate everything in our lives from vacuum cleaners to climate control, there are a few things that should probably be left to living, breathing human beings. For example, you might not want a robotic lawyer arguing on your behalf and you probably wouldn’t want to receive sensitive medical news from something that lacks the ability to deliver it compassionately.
The same is true for sound financial advice. While automated services, “financial planning” programs that offer plans that require only a handful of inputs from you, and automated investment management tools may try to convince you they are up to the job, the fact is that you really can’t replace the human touch. What’s the human touch? Simple. It’s good advice.
Good advice is timeless … and timely.
At its essence, good financial advice never goes out of style. Its principles are permanent: It should be brave and true, and meant for you. At the same time, good advice must remain relevant in an ever-changing world. Your advisor should be able to help you embrace promising new opportunities and insights, while avoiding the false leads and frightening challenges that are as formidable as ever in today’s markets.
Good advice looks at the parts … and the whole.
Good financial advice helps you manage your investment portfolio for preserving or increasing your wealth according to your goals. It also helps you plan, implement, and manage your myriad related interests: taxes, insurance, estate plans, philanthropic pursuits, business interests, real estate holdings, and more. Beyond that, what are your goals? How can we relate your total wealth to your relationships, resources, and realities? Good financial advice should bring a unifying whole to your multifaceted parts.
Good advice is personalized … and persistent.
Good financial advice is essential for making good decisions – not just in general, but for you: your money, your interests, your life. It’s about being in a relationship with an advisor who is there for you, not only during the promising planning stages when everything makes sense, but when your resolve is being sorely tested in turbulent markets. Or when your own life’s events have knocked you off-course. Good advice helps you find your way when you’ve been sideswiped by the unexpected.
Good advice is wise … and compassionate.
Good financial advice is grounded in enduring academic evidence, structured process, and informed experience. But for all that, financial advice is nothing if it fails to contribute to that which brings joy to your life, protects the ones you love, and reassures you in times of trouble. For this, a good advisor must not only advise you; he or she must listen to you. This brings us to our most important point.
Good advice is in your highest financial interests, period.
Above all, good advice should always and only be in your highest financial interest, even when it means the advisor must take a hit to deliver it. Around the world, various advocates (including ourselves) are pressing for legislation to govern best-interest advice in a fiduciary relationship. Such efforts are often met with resistance from those who would prefer to continue prioritizing their own best interests. As a result, the financial advice you choose to use will probably always call for a “buyer beware” perspective. As the late Vanguard Group founder John Bogle has wryly observed, “There are few regulations that smart, motivated targets cannot evade.”
We wish it weren’t so. That which best serves investors ultimately best serves all of us, so we would welcome a world where good advice reigns supreme. Until then, we hope you’ll know what good advice looks like when you see it. It’s the kind that sees you through turbulent times, onward to your relevant financial and life goals. If this sounds dramatically different from the stock tips or market-timing tactics you’re used to hearing, that’s because it is.
May we offer you additional advice about good advice? We hope you’ll be in touch.
Andrea L. Blackwelder, CFP®, ChFC and Joseph D. Clemens, CFP®, EA are the founders and partners of Wisdom Wealth Strategies. Their shared passion is simple: to bring financial empowerment, understanding, and peace-of mind to people who wish to improve their financial future, build wealth for their families, and achieve financial independence. Click here to find out more about how you can work with Wisdom Wealth Strategies.