Why Use a Financial Adviser?

                

Most investors don’t need financial advisers for three basic reasons.

                     

First: Basic investing principles are easy to master. I mention them often.

Secondly: What to buy is simple in the age of index funds. There is no reason to attempt to buy individual securities. I have explained why in much of my past comments and books.

                     

And three: Adviser fees eat too much out of investment earnings. I repeat this constantly. Adviser fees can account for as much as 20% and more of annual investor earnings.

                     

The garden variety of advisers, that is the bulk of them, are not worth the money because their expertise is run-of-the- mill.

                     

On the other hand, investors who have estate and tax questions need legal advisers. That has little to do with portfolio selection. (See the Earl J. Weinreb NewsHole® comments and @BusinessNewshole at Twitter.)