The #1 Mistake People Make When They Use a Financial Advisor
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- เผยแพร่เมื่อ 2 พ.ค. 2018
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The problem we have is because Most people always taught that " you only need a good job to become rich. These billionaires are operating on a whole other playbook that many don't even know exists.
Money invested is far better than
money saved, when you invest it gives
you the opportunity to increase your
financial worth.
It is remarkable how much long term
advantage people like us have gotten by trying to be consistently not stupid,
instead of trying to be very intelligent.
The wisest thing that should be on
everyone mind currently should be to
invest in different streams of income
that doesn't depend on government
paycheck, especially with the current
economic crisis around the world. This is still a time to invest in Stocks, Forex and Digital currencies.
I also keep seeing lot's of people
testifying about how they make money investing in Stock, Forex and Crypto Trade(Bitcoin) and I wonder why I keep loosing. Can anyone help me out or at least advice me on what to do.
Even with the right technique and
assets some investors would still make more than others. As an investor, you should've known that by now that nothing beats experience and that's final. Personally I had to reach out to a stock expert for guidance which is how I was able to grow my account close to $35k, withdraw my profit right before the correction and now I'm buying again.
Great video Dave, one that folks really need to watch. I’m 50, retired a while at 45. I have 35% of my capital invstments in an IRA, 25% in index funds, and the balance spread across other investment accts, in cumulative of over $ 5M. I receive income from my rental properties too. Zero debt and all is going accordingly .
You seem to be doing a bit good for yourself. Do you achieve this via a consultant? because I need a scheme to generate a high yield percentage ROI for me and advise on what that would be. In essence, good passive income outside salary.
Now that's just bragging.. anyways what do you do?
No I don’t mean it that way, I’m only saying it as it is. I’m retired and enjoying it.
@@francescadelight Seven figures that’s impressive. I would like to have that before I get to 45. Any tips?
@@kristennn850 Get an expert to introduce you to good profiting ventures now that you’re still young. No matter the age it’s better to start at least.
40 years ago, when I was a new driver, and had to buy my own car insurance, my dad's insurance guy spent a solid hour teaching me about the ins-and-outs of auto insurance in language I could understand. He retired years ago, but I'm still buying my insurance from the company he worked for. I'll never forget how patient he was.
There should be a basic financial class in high school that everyone must take.
I took one and our teacher showed us this man yessir
It's really a shame. The world would be so much better off!
I agree!
I had to take one to pass high school but all I learned was how to file taxes I literally learned everything else I know on my own time. Which I thank them for because now I don’t think I know finance when I really don’t 😂 what they’re teaching obviously isn’t working
That's the problem they don't
The pandemic has shown us just how quickly decades of planning, investing and saving can be completely upended. This could mean your current financial plan might leave you without enough money to last your retirement. A recent Vanguard study found that, on average, a hypothetical $500K investment would grow to over $3.4 million under the care of an advisor over 25 years, whereas the expected value from self-management would be $1.69 million, or 50% less.
In other words, an advisor-managed portfolio would average 8% annualised growth over a 25-year period, compared to 5% from a self-managed portfolio
I agree; for over 17 months, I've maintained regular contact with an investment advisor. Nowadays, it's really simple to invest in trending stocks, but the challenge is knowing when to sell or hold. To support me with entry and departure points, my advisor steps in. Within 18 months, I've accrued almost a million dollars from an originally stagnating reserve of $300K.
I'm happy to have stumbled upon this discussion. If you don't mind, could you tell me the name of the financial adviser who helps you with your investments and how I might contact them? It Intrigues me to keep learning
Having a counselor is essential for portfolio diversification. My advisor is “Sharon Louise Count'' who is easily searchable and has extensive knowledge of the financial markets.
Thank you so much for this tip! Finding your coach was a breeze and I was really impressed with all the research I did on her credentials before scheduling a call. It's clear from her résumé that she's extremely knowledgeable and skilled, and I'm so excited to have the chance to talk to her
another HUGE mistake: Not asking if they are a fiduciary. Fiduciaries are legally required to act in your best interest, financial advisors aren't. Not all "smartvestor pros" are fiduciaries!
Registered investment advisors are held by the fiduciary standards, they are a type of financial advisor. The other kinds of financial advisors are not held to this specific standard, however chartered financial consultants and certified financial planners are also held by board education and performance standards that are quite high. 😊
@@TJ-im5kp well that didn’t clear up any confusion at all did it!
@@meditation4632 it should have… if you understand what we are discussing. I was just specifying that some of their broad statements are not completely true for all they are referencing.
I have never understood how it can be the norm for any kind of financial advisor not be held to fiduciary standards. Are only CPAs held to tax laws for preparing tax returns? Can a CNA knowingly cause harm just because they aren't a doctor? Can a paralegal give bad advice just because they aren't a lawyer? Can I drive all willy-nilly since I don't have a CDL? Well the answer is certainly not so how in the world FAs have gotten away with this is just boggles my mind. Have they really payoff the regulators and lawmakers that much?? SMH.
Whether they are legally considered a fiduciary really just determines how likely you are to prevail in a law suit if they give you advise or sell you a product that turns out not to have been well suited to you.
When someone makes a choice to enter the professional of financial advising, based on their character, they have to make a decision to either always do what they feel is truly in the best interest of their clients, or to do what is in the best interest of their firm or their bank account.
And whether they work for a fee only firm, which is the only arrangement whereby they are legally treated as a fiduciary, or they work in a firm that also incorporates commissions as part of their revenue structure, that question of clients needs first versus my needs first still remains.
If the law was sufficient to keep bad actors from acting badly, no one would ever steal money from clients because it is and always has been illegal. Yet we see instances of this happening every single day.
So yes, you could certainly ask whether they are a fiduciary. And really that just comes down to whether their firm has a fee only model or they also accept at least some level of commissions. But that won't necessarily determine whether they are actually going to perform what's best for you in the long run. That's a question of both competence and character.
That said, it's also worth noting that the Department of Labor has a new law rolling out shortly. And the long and short of it is that law will require all financial firms, whether fee only or not, to act in a fiduciary manner towards their clients, at least as it pertains to retirement accounts.
Consequently, firms in the industry, which understand that law is coming, are already begin to right the ship towards that direction, knowing that changing their culture and their sales methodologies to abide by that law will not be an overnight process. So even if your advisor today works for a firm that is not currently held to a fiduciary standard, in all likelihood his firm is supervising him in a manner as though he was because they soon will be.
I’m a software engineer. Every engineer should listen to Dave right now. It’s YOUR job to convince your boss to put time/money in a project. If they say no it’s YOUR fault for not explaining correctly. Ever since I adopted this attitude my career has excelled.
You are Karen ,your boss need Indian SE
Rule #1, only invest in things you understand.
trwsandford “Rule # 1 Don’t lose money. Rule # 2, never forget rule # 1.”
Warren Buffett.
Gharar “lack of knowledge” or “uncertainty” search it up
trwsandford you understand how a cell phone works? A computer? These are unbelievable complicated- so no bad perspective
@@jakemf1 you don't need to fully know about the smallest details but understanding the fundamentals and concepts is the most important thing. Otherwise your ignorantly throwing your money away.
that is what Warren Buffett always say
Best lesson I ever learned was to happily admit my own ignorance and be receptive to learning from everyone.
me too, at age 59 finally got "a team".
"Heart of a teacher, not the heart of a salesman." Wow! Ding, ding, ding! Thank you!
I tell all clients no matter what professional you work with, if they talk down at you, if they get angry with your questioning, then you fire them asap. It's not our job to talk down at you. It's our job to educate and do what's in your best interest. That's how we stay in business and help people.
I work in the investment industry, and the advisor with whom I work is most interested in educating potential clients, building relationships and learning potential clients' goals for investing. Our clients make us humble, our job is to serve our clients and celebrate their success.
You've found a good one 👍🙌
howd you get into the investment industry if you dont mind me asking.
@@TK-Leftyy I want to know too
Thank you for this! You inspired me. 🙏🏼
Dropping truth bombs, like always. A lot of people need to remember that it's THEIR money. The advisor is a tool and a facilitator to help you achieve your financial goals! 👍👍
I'm talking to a Financial Advisor from First Command and he is great at teaching me financial stuff. He used to be a history teacher so he likes to teach.
Dave has some good points but the most important thing you need to know is how your financial advisor gets paid. You may see a lot of the recommendations revolve around how they're paid.
Agree - we just created a video to explain this as well since it's a question you should be asking your advisor!
Techno cussing....as an IT guy that's such a funny term. I love it.
Your advisor should get excited when you're curious and interested in learning
Thanks Dave!!! I'm glad to run into this video. I am struggling with people who's taking advantage of the elders and the disadvantages. It's rather frustrating and you're right they are so pushy and condescending. Unfortunately, I don't have time to help everyone.
I'm in training to be an FA, and this is the best advice I've ever heard. And definitely something I'll embrace with my clients. THEIR MONEY!! THEIR PRIDE!! Make it easy for them and walk them thru the process and did I say make it easy? MAKE IT EASY!!!
a con man makes the trip down the rabbit hole easy
when my wife and I first got our house and noticed "hmm, I'm not pulling in all this easy money like I was when I was living with mom and dad... we're actually losing mone now, where's it all going?" then I found this really neat financial advisor called "an excel spreadsheet" now I'm just a couple years from being debt free
The same thing in the beginning, when I bought a house. I asked where are losing my money, even suspected some of the bank steals from me. My financial advisor is also called "an excel spreadsheet", which is used for budget and tracking expenses. In reality, the money goes in unexpected things, in small expenses which accumulates by time. The same advisor calculated for me how to save interest rate of mortgage - saved 3000 euro. The same advisor saves me from going to another debt.
Same here. I use Excel to balance debts and credits. Additionally, I use it as a projector for when I should have each debt paid off.
What are your techniques on saving for retirement?
Ryan Cook good luck...I hope it’s still going well. You got this!
Can your excel sheet, project your 401k's terms and conditions and your life I insurance's liabilities too?
Funny thing is that I keep on saying that ( it is my money) to the Gov when they try to take it away from me, but it never works !
😂
i love, love, LOVE our advisor! heart of a teacher, that's for sure.....god bless him
8:00 That is so valuable what he just said in regard to real estate agents, that is the look they give you after you refused the third house you looked at and don't buy it.
"Techno cussing" 😂😂😂 that's hilarious
I agree big time. I'm in banking and when I refer customers to my financial advisor, he get to know the clients wishes and goals first. I would rather the client meet with the advisor 2 or 3 more times in order to educated about their options. I want them to feel comfortable and know the direction they want to go. To sleep at night and to feel confident. If the finacial advisor can't educate with patience, they are not the right person. Great video!
In every industry there are people that want to genuinely help and ones that genuinely want to push you towards whatever product is paying the largest bonus that month. I found that Education mixed with Godly discernment is the key to dealing with anyone at any level, especially when it comes to your hard earned dineros.
Time share businesses too?
Love this Dave! As a Financial Professional I 100% agree.
Well said. Thanks for empowering me!
I supervise advisors and this is good advice. We constantly ask advisors if their clients understand what they're invested in, and sometimes reach out to customers to confirm this.
“I got PHD in D.U.M.B” hilariously relatable 😂
Man, I love you, the information you provided, they way you talked about it and the personality you presented! Thank you sir!
If I had just seen this video one month ago. Things would have been so different now! Thank you Sir, I needed that advice!
This is so true, anyone who’s upset is the actual problem.
Absolutely great analogy about you and your tech staff!
Most financial advisors are of the mindset "It's YOUR money, and I want it NOW!"
Needed this now more than ever! Thanks!
Thank you. As someone who is just getting ready to meet with a financial advisor for the first time this was so helpful!
I needed to hear this
Thank you so much for this, I have an appointment soon with a financial advisor and this really helped
Many thanks for educating me Dave.
Very enlightening! ! Thanks Dave!
I love that Dave used technology as an example. I've only been in the IT business for 10 years or so, but if you like IT and you have the heart of a teacher then PLEASE go into IT. Having the heart of a teacher is something so hard to find in this industry and I realized quite early that it set me apart from my peers. I'm not the smartest guy in the room, and won't always have the answer but man it will set you apart like no other in this field. Being able to bridge the information gap between IT and the business guys is HUGE.
I have a four year BSBA degree and no company will even interview me for an IT career because they don't want to spend any time training. They expect their ideal candidate to be 110% ready on day one.
Thanks for the answer.
This is the exact question I had today, Thank you for your insight Mr. Ramsey.
My child's almost-pediatrician learned condescension instead of education as well. I had a few questions about a particular treatment method, and he lied to my face about what Texas law is, and what other doctors in town were doing, to try and force my hand. Guess what? I FIRED HIM!!!!
I have fired several Doctors
GOOD FOR YOU!!! I’ve fired a few doctors too.
People fall into 3 categories here:
1. Financial Advisors can’t tell me something I don’t know (Arrogant)
2. Finance is so complicated I just let my guy handle it (Lazy)
3. I’ll listen and determine if what you’re saying is making sense (Smart)
So if you genuinely know more about finance than most financial advisors, that makes you arrogant? Got it. I would think that makes you smart.
Yes, because you can only determine that you genuinely know more after you listen to the man (or woman).
WOok2a well if their investment plan is an annual 10 percent ROI when I can get a 20 or 30 percent ROI I think I can say I know more than them
@@dwaynejohnson3656 Your projections mean nothing until realized. You must also consider the beta inherent in your investment plan.
WOok2a if you read my comment you would see that I didn’t say it was a projection
Your videos are very useful and provide lots of information. I have received lots of help after watching this post, please continue to share this kind of information. Thank you.
Thanks Dave!!
Thanks so much for the video. I subscribed already to it.
Thank you so much for this.
This was so good to see!!! Much needed.
Great advice, Dave. Thank you
Thanks Dave. That question was for me too.👍❤
7:45 that is why Dave is legendary 🤣
As a student in a financial planning program about it enter the work force, I have seen the kind of planners Dave mentioned and I avoid those firms like the plague when it comes to a career field. But the industry is moving towards a customer first mindset with the CFP fiduciary standards being set that want to teach financial literacy to their clients and help them know what is going on. I hate the name financial advisors have now because the people who have hurt our image by being so focused on sales and thinking they knew what they were doing because they went through a training program at an insurance brokerage place with the name “financial planning” as a cover up to get into people’s wallets....
Dave Ramsey Suze Orman or any other of these charlatan scammers are not interested in helping anybody but themselves
I actually agree with this a lot. I am a financial advisor and I feel like my job is more or less to make people comfortable with their plan and what they are trying to accomplish.
I am one as well and I agree with your statement.
I am an investment advisor as well and agree. Our job is keeping the client from hurting themselves. Investor behavior and fund flow data shows people like to buy high and sell low.
❤️❤️
Love the encouragement
Getting a financial advisor was one of the wisest things I have ever done. She did insist that I understand what her plan was and spent time explaining things before and after I signed up with her. Made my first million earlier this year through her.
Impressive. Mind sharing who this is? Been thinking about getting one
@@emersonstagnitta65 "Nancy Lynn Lewis", was in the news a lot in 2018. You can check her out on the interweb for more.
@@chrisbrian433 Wow I know this little lady. Once attended a seminar she was also in attendance here in Texas,, Great speaker.
@@archiemcdougald5466 This right here is the second time I am coming across this name in a week. Came across her podcast and it was lit!
Can't trust this comments
My mentor is a Fa I’m a F.A in training the first thing he thought me was it’s not about making money , it’s about helping people live better lives . I took that lesson to heart coming from a poor country all I want I to do is help people become their best selves .
Note that he did reach the point where he said “basic knowledge”. Don’t expect your advisor is going to re-create a college level investments class or help you pass the CFP exam. To have “a bit more knowledge” is fine. Don’t expect a chance to earn your MBA. That’s not their job.
Love the way you go over topics haha
what dave forgot to mention is to avoid "financial planners" that push commission based products on to you. This creates a huge conflict of interest and will most likely result in you losing your money
ISDcaptain592 That’s the exact opposite of what you should do. Seek out financial PLANNERS because that means they have a CFP and are the only ones allowed to utilize the title. So aren’t posing as some wealth/retirement management consultant that can actually only sell annuities, REITs, or life insurance. It’s sad that the market is so saturated with fear and discourse because it’s a profession same as any just providing a service.
Thank you. Thank you. Thank you!
Already love this guy. This guy frank and honest. This not social club or talk about our feelings. Financial advisor goal should be stating only facts and not pump you up to purchase a stocks immediately. Also they should not harass you to purchase a stock like a scammer. This guy make me content even negative frank answers. Basically reality check is better than a sugar coat mold bread
Very good points
Get a fee only Financial advisor.The best part is he teaches what an Investment is all about ,divides the port folio and advices not forces ,because he is not there for commission
Do you mean get a free financial adviser because you put get a fee financial advisor and I'd love to know where to get a free one that knows what hes doing any info would be helpful
Great advice on the first question read
Awesome thank you
You won't often get it all in a meeting with the advisor, same as buying anything on the cuff. Sleep on it, take a month, but know what you're getting into. If you are pushed, let that push you away.
Sorry for writing you, just out of curiosity your page come up on my suggested friend lists so I was just wondering if I knew you from somewhere?!!!
I have a yearly financial check-up with my retirement accounts that's it. I do my own research.
Fantastic advice!
Thank you! That is amazing advice and very refreshing to hear this. You are right we should not go in ashamed or embarrassed it’s our money and we work very hard for it and they have to earn our trust and be able to show us what they can do with our savings and be able to teach us and if they don’t do that then it is not the right fit for us. Thank you!
Good advice as always Dave
Agreed!!!!!!! Do not be intimidated with these people!
I fired my financial advisor years ago. I gave him the opportunity to manage a small portion of my portfolio with the idea he could earn all of it. He failed. Too bad for him.
Thank you Dave, I am seeing all these wealth simple trades ads here on TH-cam. Finally decided to try ....but to me something isn't right the way they are pushing their advertisements.I honestly wouldn't known not to throw money at a stock if I didn't know what would happen next
This Info is so TRUE.
Great advice!
What a great rant! I love it.
Sorry for writing you, just out of curiosity your page come up on my suggested friend lists so I was just wondering if I knew you from somewhere?!!!...
Great advice, could not agree more
Great advice. I’m a FA and I teach not sell, because once I help you understand the benefits of the products they should sell themselves. Don’t be afraid to use a FA, just choose the right one.
Financial advisors get a percentage of your investment every single year whether it gains or loses. The first rule should be discover how much they charge for their services and get it in writing. I have friends who are being taken to the cleaners by their friendly local financial advisor.
Sorry for writing you, just out of curiosity your page come up on my suggested friend lists so I was just wondering if I knew you from somewhere?!!!...
What great advice and I don't know that you'd ever hear this take anywhere else.
That is really good advice David. .I had money in the bank but iam scared to do investing because I don't have nolege to do it so I put all my money in bank until I learn to do my own.thanks for sharing that.
Agree he is spot on
dave your are a life changer
Lol @techno cussing 😂 😂 😂
Getting a financial advisor was one of the wisest things I have ever done. She *did* insist that I understand what her plan was and spent hours explaining things before I ever signed up with her.
It’s my money and I need it now!
If you are going to get a financial advisor make sure it's a fiduciary, by law they have to work in your best interest not suggest investments to make them money.
Yeah, please do this. But don't know enough to be dangerous. You wouldn't believe how many people tell me they want a fiduciary and end up at Baird or Edward Jones.
@@michaelendress3979 many people at investment companies aren’t fiduciaries but are chartered financial consultants or certified financial planners which are held to a similar standard to act in the best interest
@@skyewatson6204 That isn't accurate. A legal fiduciary (doctor, lawyer, investment advisor) must ALWAYS act as a fiduciary for their client under penalty of law. If I don't act as a fiduciary, I could be civilly and criminally liable.
If a broker who has CFP doesn't act as a fiduciary, he or she would not face any civil or criminal liability for breaching fiduciary duty. I could lose my license, large amounts of money, and possibly even face jail time by not acting as a fiduciary. At worst, a broker who didn't act as a fiduciary may lose their CFP.
I face audits to ensure I am acting as a fiduciary from the state. I don't believe CFP goes around auditing their CFPs.
Additionally, I am not permitted to charge any "uneven" fees to the client; thus, I can't earn a commission for recommending a certain fund. However, CFPs are allowed to do so as long as they "fully disclose material conflicts of interest to the client", among other things.
It's not the same, no matter how much a CFP may try to pretend it is.
@@michaelendress3979 Interesting, so can someone with a CFP or CHFC designation be a fiduciary?
@@skyewatson6204 Yes.
Loved "Techno cussing". Thanks for your advice!
Grate advice just like panditdav advice.. I meet panditdav ON TELEGRAM AND HIS ADVICE GOT A VERY LONG WAY TO HELP MY FINALLY STRUGGLING
Agree, 100%.
I have a financial advisor that I saw a couple times already. My wife is on board with their plans because she doesn't have any experience investing. I've been investing my own money my way for two years leading up to before we got married. Our advisor wants us to set up an account where her firm will invest it for us and they'll take 1% out of the balance each year for themselves. That's crazy, especially if most of their picks are stocks that I can just buy through my brokerage account if and when I want. Half of their picks was investing in banks. I found it insulting.
K R definitely always have final say over your money don’t let anyone else touch it without your say so that firm sounds like a bunch of no good money grabbers
give me your money! I will do it for 0.9%!
That's insane, total ripoff. Better to just invest in a stock market index fund.
1 year later. Banks are one of the worse performing sectors to date...
@derek flint That is not legal or a financial definition. Although your option which is just as valid. Just classic example of Dave Ramsey giving shitastic advice again about things he not an expert on. Multi generational wealth all use financial advisors, Dot-Com millions didn't.
"I've got a PHD in D.U.M.B." Hilarious! Yet the most successful people I know have made huge mistakes in their careers. Well said.
Good point. It IS your money.That IS the bottom line.
Good speech
Got here searching "old guy giving financial advice"
😂
I got here searching for "i need generally bad investing advice".
It seems the best advisers are like yourself, Mr Ramsey, great educators.
simple Google search will shine light how funds work ,check index funds how they out preform managed mutual funds .Agree avoid Insurance high pressure sales they did it to my mom she lost 12k in fees with annuities .
My in-laws lost almost everything due to a dodgy financial advisor. My late husband had lost $10k+ before I met him due to another hopeless financial advisor. I used to work for an investment company that created managed funds. One of my jobs was to pay the commission cheques to financial advisors. Our products were hopeless, but the financial advisors earned well from them. I don’t trust advisors. But here in Australia I think it’s because of how we have the financial services licensing setup. They almost all work for, or on behalf of, large financial institutions. Very few are independent. And the vast majority only work for their commission, often at the expense of their clients.
Wish we had your ELP’s here Dave. Great advice xx