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The Number One Reason To Hire A Financial AdvisorSubmitted by Mike Tarrant, CFP® on September 20th, 2018
Hey, Mike here. I just read this article and loved it! The point I want to make is this: I am here to educate and advise you using real, common-sense financial planning. I want you to live empowered, fuller lives and have margin to help others. And I want to encourage you to have a long view with respect to investing. Don’t get distracted by the latest news, trends, and reports. I encourage you to take 3 minutes to read this article and watch the video below. It’s a great reminder to refocus on what matters in your financial life. If you have any questions, please call me at 770-353-6414 or email firstname.lastname@example.org.
Keeping your costs low is a simple way to improve your chances of pursuing your investment goals. If you want to try to beat the market, then tilting your portfolio to risk factors, such as value, value and momentum, which are known to have outperformed over the long term, should also help to maximize your returns.
But the problem is that you can keep shaving basis points off your costs, and you can know your Fama-French Five-Factor Model inside out, but if you don't control your own behavior, you can kiss goodbye to any hopes you had of a truly successful investment experience.
The secret is to tune out the noise - to ignore the doom-mongers when markets start to fall and to keep a level head when they reach dizzying new heights. It's about not being seduced by the financial media and the marketing departments of big financial institutions into buying this or that. It sounds easy, but it isn't. Human beings are very social animals. We like to do what others are doing, and we're prone to a wide range of behavioral biases that make us extremely susceptible to persuasive narratives. We are, in Benjamin Graham's famous words, our own worst enemy.
For me, this is the Number 1 reason why most investors are better off paying for the services of a financial adviser. Someone who really takes the trouble to get to know you and work out what makes you tick. Someone who understands where you want to get to, and the self-destructive thought processes that are likely to get in your way. Someone who can keep you on an even keel, who'll listen to your hopes and fears, and who isn't afraid to disagree with you. Someone, in short, to help you tune out the noise that bombards investors every single day.
Dimensional Fund Advisors has just released a video which makes this point effectively. If you find it useful, please share it with others. If this one thing investors need to understand the importance of, it's this.
Watch it here: https://us.dimensional.com/perspectives/tuning-out-the-noise
ROBIN POWELL is the editor of The Evidence-Based Investor. A freelance journalist, he runs Regis Media, a specialist content marketing consultancy for financial advice firms, and is Head of Client Education for the UK-based financial planning firm RockWealth LLP.
The opinions voiced in this material are for general information only. Investing involves risk and the performance referenced is historical and is no guarantee of future results.