Financial advisors or stock brokers?

Question

We have met with two "financial advisors", and they both knew nothing about real estate, or commodities, or gold, etc....They were actually stock brokers, and that's about it.  Does anyone have a financial advisor who knows about a broad range of investments?

Jonathan W · Answer

N/A N/A,

Let's flip it (no pun intended) or turn the question around. It's possible I am almost opposite you in terms of experience. I worked as an analyst in a fund picking stocks, so I know that stuff. However, I don't know real estate well.

Let's say I am looking for a general real estate advisor to help me with where to invest. 1) It's unlikely I am going to find someone expert in all the areas of real estate to actually add value beyond, maybe, "indexing" my money. 2) If I actually do find someone expert in at least a few areas, is it likely they will be a "real estate advisor?" Probably not; it's more likely they will be an actual investor, etc.

The same goes with financial advisors. At worst they are there to just sell you stuff and, at best, know about the different investments you are talking about. At the very very best maybe they are good investors. But, they probably won't be great in all the categories of stocks, gold, resource investing, etc. In other words, as has been mentioned here, you need an expert.

But, I would contend, you don't need an expert financial advisor (if what you are looking for is investments and not financial planning), you need an expert investor. It will take some digging, but you have to start looking for RIAs or hedge funds that meet what you are looking for. Even that route, though, you are unlikely to find someone expert in all the areas you talked about, so you will have to split your funds up.

Lastly, and correct me if I am wrong, it seems you know a little or a lot about the different areas you are looking into or how else would you know if they knew what they were talking about? That makes me think you want to have a hand in in investing your money, discuss things with the manager, etc. If that's the case, a good money manager is just going to want to invest your money and not review their every move. You have to take that into consideration. Again, maybe I am reading you wrong.

I was just browsing here and didn't think I would sign up, but did so to answer your question; I hope it helped.

Good luck

J

Thomas S. · Answer

A Certified Financial Planner (CFP) is likely a better bet. They have stringent testing over a broader range of financial products. It will vary from firm to firm but they will generally have a much broader experience with financial health.

Tom Goans · Answer

Sure, such a person exists. Many feel they have broad knowledge. The same can be found in the real estate business.

Will you be getting the BEST information and options from such a person?

A brain surgeon can offer suggestions about your sore feet. Will it be the BEST information?

Another way to look at this, the old saying 2 heads are better than one. Investment strategies are finely tuned complex operations. More than one brain providing ideas may be the best choice.

Let me put my thoughts into an example. My family used one CPA. However, the CPA was very conservative and did not want to explore new tax options. Sometimes, he overlooked options. My father is extremely educated in tax laws and options. Between the two of them, my family had a much better financial plan for each individual and for the family as a whole. At times, advice from attorneys was interjected.

The end results and goals being met were more important than how many professional advisors it took to achieve success.

Carole G. · Answer

I get what you are saying, but to continue with your analogy of the medical field, I look for doctors who talk to me about my spiritual and emotional lives, as well as what is physically going on with me, because the three are inter-connected.  Likewise, I want someone to advise me on ALL my investments in the big picture to reach my goals, whether that includes 401k, real estate, pensions, cash, gold, commodities, or what have you.  Does such a person not exist?

Tom Goans · Answer

Investing is similar to being a doctor, a real estate expert, or an attorney. The best results or opinions are derived from specialists. Different fields require different specialists.

The investment in specialists can be the most economical and wisest investment, especially for future considerations.