One question we often hear from prospective clients is: Do I need an advisor? The truth is, this isn’t a simple yes or no question.
Your answer depends on a wide range of factors. However, in our experience, you might be able to better answer this question if you determine how you approach your personal finances. We’ve found that there tend to be three types of individuals when it comes to managing money:
DIY (Do It Yourself)
Help Me Do It
Do It For Me
Keep in mind that there is no right or wrong way to tackle your finances. However, it is helpful to know which group you fall into so that if and when you choose to engage with an advisor, you can find someone who is the perfect fit for you, and you engage with them in the manner that fits your unique needs.
The best way to determine which camp you fall into is to hear more information about each group. Keep in mind that many people move between these groups in different stages of their life, and there is not a wrong group to be in!
In our experience, DIY-ers are curious about how to manage their money the right way. They are ready and able to implement what they learn on their own. These days, there are enough resources available for any person to gather more than enough information to get their finances in order. DIY-ers are capable of researching the information they need to get (and stay) organized when it comes to their money.
One difficulty is that individuals in the DIY group have to wade through incorrect information in order to get the quality information that they need. Then after the research is complete, they reach the hardest part: implementing and sticking to their plan.
Most of us are busy doing our day job, and that makes it difficult to set aside time to set up the automatic savings draft, complete the life insurance application or any of the other financial “to do’s” on our list. However, there are some people that are motivated enough to handle the one-time and recurring tasks that come up.
One word of caution to the DIY crowd is that you don’t know what you don’t know. For example, right now my check engine light is on in my car. I think it’s because I am a few miles late on an oil change, but it’s possible a more severe issue could be at play – hopefully the engine isn’t about to fall out… I am left to hope that my assumptions are correct even though I am not a car expert. I don’t know what I don’t know. Sometimes, it’s good to get a check-up on your overall finances, even if you intend to research and implement issues that you are aware of.
Help Me Do It
Individuals in the “Help Me Do It” camp are well aware of what they don’t know – and want an advisor’s help to guide them through their financial plan. They are wise but also ask questions, and they’d like to know how to fix potential problems that come up. They may choose to fix financial problems themselves, or they may ask for help in the implementation.
Quite often, these folks have been in the DIY group, but a change in circumstances has caused them to ask for help. It could be that they are now making more money than they used to, they just had a new child so their time is limited, or they got a new job or promotion that is taking up most of their time. The people in this category may have had a realization that they don’t know as much as they previously thought they did. So they’re calling in for some backup.
All of our clients are very good at what they do, and they are comfortable outsourcing some aspects of their financial life to a financial advisor. The people in the “Help Me Do It” category still want to maintain some control in the implementation of their financial plan, but there are other aspects that they want help.
Do It For Me
The “Do It For Me” camp is typically full of very busy individuals. They may have a very demanding job, intentional about family balance, or they keep busy in retirement. However, just because they want someone to implement their financial plan for them does not mean they’re not interested or don’t care.
For example, we offer to meet with our clients quarterly, and we insist that we have an in-depth meeting or conversation annually. The people in the “Do It For Me” category have great questions about what they should or should not be doing. They are interested in understanding what’s going on within their plan, including their investments, but want someone else to take care of the details.
Which Are You?
Knowing which camp you fall into can help you find an advisor who supports you and your financial goals. For example, a DIY-er may be happy with an hourly advisor to ask questions periodically, but implement on their own. Alternatively, a “Do It For Me” person may want someone who is more available as a fully outsourced financial solution.
If you ever have questions about your financial plan or want to explore whether a relationship with an advisor is right for you, please feel free to reach out! The team at Botto Financial would love to get to know you.
This material has been provided for general informational purposes only and does not constitute either tax or legal advice. Although we go to great lengths to make sure our information is accurate and useful, we recommend you consult a tax preparer, professional tax advisor, or lawyer.
Wesley Botto is a financial consultant located at Botto Financial, 4565 East Galbraith Road, Suite B, Cincinnati, OH 45236. He offers advisory services as a Investment Adviser Representative of Commonwealth Financial Network®,a Registered Investment Adviser . He can be reached at 513.924.3350 or at email@example.com.