Broker Check

Monday Money Report

| May 10, 2021

Last week the jobs report came in below expectations.  New claims continue to drop, but overall unemployment is still above 6%. Despite this news, the market continued to grow, setting yet another new high.

All this growth in the market may cause you to wonder if it is worth talking with a professional. Most research will tell you that working with a qualified financial advisor is definitely worth the cost. Vanguard has a popular study on the value of advice that shows the advice provided by an advisor is worth as much as 3% a year in overall portfolio growth.  And Morningstar research shows that people who work with an advisor end up with 27% more saved for retirement than those who don’t.  In economic downturns, investors who work with a planner and have a financial plan in place are less likely to sell low, and more likely to stay on track.  Now, these are all averages, and a lot can depend on who you work with and what they do for you.

In a survey by personal finance website MagnifyMoney, 25% of respondents said they though they did not have enough assets to work with an advisor.  25% also said they thought you don’t need an advisor until you are middle-aged. These may be true if you are working with a traditional stockbroker, or registered representative.  But if you are working with a financial planner, it’s hard to find a time or asset level when professional advice won’t help.  Think about where you’d be now if you had started saving in a Roth IRA when you got your first job.  Many planners will meet with you regardless of assets for an hourly or flat fee, and some provide ongoing financial coaching if you want more help.

A financial planner can help with budgeting and cash flow, selecting your employee benefits, reviewing your home and auto insurance, all in addition to managing assets and providing guidance on your retirement plan at work.  As your assets increase, they can help maximize tax efficiency, plan for college, a second home, or a bigger boat.  They will work with your estate attorney to pass along the wealth you’ve built.

If you are looking for a financial advisor, ask your friends and family, or your favorite Facebook group, for recommendations. Interview several and ask how they get paid and what services they provide.  Can you come in during open enrollment to review health insurance choices? If you are refinancing, will they compare options with you? And ask how they get paid, and if they are a fiduciary, someone who is legally obligated to act in your best interest. No matter what, check out any financial professional on FINRA’s broker check.  Terminations, suspensions, and fines are serious red flags.

Your action to take this week is to sign up for one of our upcoming events.  If you are getting close to retirement, we have two events on tap for you, Retire on Purpose and a Social Security Workshop.  You can register for these and find more resources on our website at and on our Facebook page. 

Securities offered through LPL Financial, Member FINRA/SIPC. Investment advice offered through Great Valley Advisor Group, a Registered Investment Advisor. CovingtonAlsina and Great Valley Advisor Group are separate entities from LPL Financial.

All performance referenced is historical and is no guarantee of future results. All indices are unmanaged and may not be invested into directly.

The opinions voiced in this show are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine which strategies or investment(s) may be appropriate for you, consult with your attorney, accountant, and financial advisor or tax advisor prior to investing.