Are financial advisors a waste of money? Here’s what experts have to say.

Most people don’t have a financial advisor - and it’s often a huge mistake.

Here’s the thing: People with financial advisors tend to see 3% more in net returns per year, according to a 2019 Vanguard study¹. That adds up over time, especially when you’re thinking long-term.

3% a year is a big deal over time. Here's why:

If you were to invest $500,000 over 20 years, an extra 3% return per year would grow your investment to around $903,000, netting you around $403,000.

But more importantly, advisors handle all the tricky stuff you probably never considered - like complicated retirement planning and bizarre tax rules. These things can cost you big if you try to handle them on your own.

A comparison site like Datalign (link here) can help you find a well-vetted advisor in your area.

Experts agree: Sure, you can manage things on your own if you want to, but most people don’t have the time to actually do things right. There are huge benefits to having somebody pay attention to your money all the time.

So, are financial advisors a waste of money?

Not if you’re looking to save time, avoid mistakes, and grow your wealth.

If you’re not sure where to start, use a comparison site like Datalign to find a trusted advisor near you with good reviews.

Or, take this quick quiz to get matched with an advisor that fits your needs.

Knowing these seven common mistakes when picking an advisor can save you a ton of stress (and money) in the long run.

1. Only work with an advisor who puts you first

You should always hire a fiduciary financial advisor because they’re obligated to act in your best interest (they won’t push investments just to earn commissions). Non-fiduciary advisors can recommend products that benefit them more than you (costing you more in the long run). This free tool can connect you with one who actually looks out for you.

2. Don’t hire the first advisor you find

Your money is too important to trust the first name you see online. Take time to talk to a few advisors before picking one that fits you best.

3. Make sure they focus on what you need

Not all financial advisors do the same thing. Some are great at planning for retirement, others help business owners or people with big investments. If you’re just starting out, you don’t need someone who only works with millionaires. Make sure you find someone who actually understands your situation.

4. Pick someone with a strategy that matches yours

Every advisor has their own way of handling money. Some go for high-risk, high-reward investments, while others prefer slow and steady growth. If their approach doesn’t match yours, you won’t be happy with the results.

5. Always check their qualifications

Advisors have to pass tests and earn certifications before they can give financial advice. Ask about their background. If they won’t give a clear answer, that’s a bad sign.

6. Know how they make their money

Some advisors charge a flat fee, some take a percentage of what you invest, and others get paid for selling certain products (which can be a conflict of interest). If they make more money by pushing things that aren’t good for you, walk away.

7. Find a trusted advisor without the hassle

There are plenty of good advisors out there, but picking one can be overwhelming. This free tool makes it easy - get matched in just a few minutes.

That's all (for now).

Thanks for reading!

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