The Benefits of Professional Financial Advice
THE BENEFITS OF PROFESSIONAL FINANCIAL ADVICE
Have you ever heard the phrase “buy low, sell high”? When it comes to investing within the market, many individuals have heard this term and understand the concept behind it. When markets are doing well and security prices are high, it is a great time to sell securities to make a profit. When markets are down and stock prices are low, it is an opportune time to buy securities at a discount. This is a very standard trading principle implemented by new investors to individuals who have been doing it for their entire career. This has left many individuals wondering what the benefits of professional financial advice are, considering that all securities trading professionals utilize this basic principle.
As a comparison, a homeowner discovers they have some plumbing issues. The homeowner may have some basic understanding of plumbing, such as how a plumbing system operates. However, plumbing is an essential function of a home, and performing self-repair may cause more problems than the original issues. Furthermore, if self-repair occurs and fails, this may lead to more confusion and problems when the homeowner inevitably has to contact a plumbing professional. The same goes for financial advice. If an individual decides they can utilize the “buy low, sell high” rule, they may come to find that trading securities safely and effectively is much more difficult and nuanced than they were led to believe, potentially leading to long-term consequences.
Financial planning is not a one-size-fits-all strategy. Professional financial advice should be tailored to everyone’s financial situation. Here at Cornerstone, our advisory team focuses on five key components: estate planning, retirement income planning, risk tolerance, tax planning, and health care planning. Estate planning aids in making sure any assets left to a beneficiary are not going to impact the beneficiary by way of excessive tax costs. Retirement income planning will help the client identify their retirement needs and goals, such as planning for trips, recurring hobbies, mortgage and car payments, etc. Risk tolerance is of the utmost importance to an advisor, as it will help to determine the comfort level of a client regarding their long-term investment strategy. Health care planning is essential to help financially prepare a client for the potential need of long-term care, be it for themselves, a spouse, or others they may care for. Finally, tax planning is derived from both risk tolerance and retirement incoming planning, in that depending on the preferences for income and risk, an advisor should create a strategy to meet these requirements. Such strategies may create tax issues that may be unforeseen to the everyday investor, which correlates to the “self-repair” comparison discussed earlier.
Individuals approaching or within retirement usually wish to reduce their time spent dealing with daily upkeep. Finances are no different, and navigating the convoluted world of impactful investment strategies can become a time-consuming task. A major benefit of receiving professional financial advice is freeing up time to enjoy doing the things you love most. When a trusting relationship with a knowledgeable advisor is established, an individual knows that their advisor is working hard to help them implement a strategy that is focused on navigating market upturns and downturns while remaining cognizant of tax implications and risk preferences.
To see how Cornerstone can help you with financial planning and your retirement portfolio, call our office at (775)853-9033 or click here.
Based in Reno, NV, Cornerstone is for individuals and families looking to grow wealth, protect and preserve their life savings, and plan for the distribution of their estate in a tax-efficient manner through a tailored strategy. Schedule a time to discuss your financial goals with us.
©2024 Prime Capital Investment Advisors, LLC. The views and information contained herein are (1) for informational purposes only, (2) are not to be taken as a recommendation to buy or sell any investment, and (3) should not be construed or acted upon as individualized investment advice. The information contained herein was obtained from sources we believe to be reliable but is not guaranteed as to its accuracy or completeness. Investing involves risk. Investors should be prepared to bear loss, including total loss of principal. Diversification does not guarantee investment returns and does not eliminate the risk of loss. Past performance is no guarantee of comparable future results.