Why you don't seek financial advice from a financial planner?
Why you don’t seek financial advice from a financial planner?
According to a survey by CNBC, 99% of Americans don’t use a financial advisor for various reasons such as lack of trust, transparency, or they’re under the impression that it may just cost them too much.
The survey reflects a sentiment that we see here in Australia.
What’s holding you back?
1. Not yet ready for a financial advisor
While financial wellness or getting your finances sorted is often listed as a new year resolution or personal goal, most people generally know what to do to improve their financial situations, but some are just not ready to do it.
Some shy away from the prospect of denying themselves self-indulgence, assuming that a financial advisor will turn their lifestyle upside down or judge them because of their current financial status.
Our expert Newcastle financial advisers are not here to judge you or turn your life upside down. In fact, we have created a specialised cashflow program “TAP & GO” to ensure your lifestyle is not affected or that you are not sacrificing today for tomorrow, and you can continue to “TAP & GO”. However, our team also hold our clients accountable and can be direct when required. Some individuals need this support, whereas others have their finances in order and are seeking further direction and clarity.
2. The cost of a financial advisor is too high
Due to the modern portrayal of financial advisors in media, many assume that you must be rich and famous just to talk to a financial advisor. This perception leads to an assumption that it takes thousands, if not millions of dollars, to work with a financial advisor.
Many Australians are working hard to pay bills and make ends meet. However, to further pay to meet with a financial advisor is seen as unrealistic.
The government continues to place higher compliance, education, and costs on financial planners, which is then passed on to you. Therefore, fees have risen significantly over the past few years. With the median advice fees have increased by 20% over the past two years alone, as the cost of doing business continues to rise.
The cost of seeing a financial planner starts from $3,000+ to set up a plan, and then about $3,000+ annually if you have an ongoing relationship with the planner.
It really does come down to the complexity of your situation.
With this fee, a small number of our new clients question what they get for their money.
Initially, we see new clients focus on the tangible aspects - like super or investment fee savings, savings on tax & investment performance.
However, over time it's actually the intangible that is valued more by our clients. The certainty that comes from having a clear plan & confidence in becoming financially free.
It's the peace of mind that comes from living without financial worry, without wondering if you should be doing something more, something better to manage your wealth. That is the real value.
Again, the value of advice is personal, just as advice is personal. What you place value on or why you sought the advice of a financial planner, will be completely different to your friend or family members.
3. Pride
The second most quoted reason for not speaking to a financial advisor is pride. Much like the crowd who claim to be unready for financial advice for fear of being judged, many individuals are ashamed to admit major money mistakes and feel like failures.
This destructive cycle continues as more and more money mistakes are made without the proper guidance, digging the hole even deeper.
We see this particularly with males. In our experience men do not like to ask for help.
Whether that is going to see a doctor for a check up, see a dentist, see a personal trainer, or even ask for directions.
We see this with financial advice too, Over 90% of our enquiries are from women seeking help.
The fundamental reason men don’t ask for help is that they have learnt not to. They have slowly and systemically learnt that asking for help is not acceptable. What is acceptable is being like the men who have come before them; autonomous, self-reliant, stoic and independent. Their sense of identity is steeped in the good, strong, independent man who is the lone wolf. And the lone wolf goes it alone.
The rhetoric goes like this.
Ask for help = Unable to help yourself = Helpless = Victim = Weak
Studies show that asking for help makes you happier, healthier, more successful and have better relationships.
4. Lack of Trust
It is a well-known fact that people do business with people they like, know and trust. It’s scary to share one’s financial skeletons with a complete stranger and even scarier handing over our money to them.
Our financial planners are here to:
Listen to you.
Understand your financial goals and help you achieve them.
Enabling you to live your best life
Your financial planner - Matthew McCabe
Newcastle Financial Advisors is a family owned advisory firm, on a mission to empower everyday Australians through financial literacy.
We are not here to “push products” or sell you anything.
We are here to support and educate.
Newcastle Advisors
Newcastle Advisors is a family owned advisory firm, that was established to empower everyday Australians through financial literacy.
We are not here to “push products” or sell you anything.
We are here to support and educate.
However……There Is A Deeper Problem
But I think that the problem goes deeper than all of this.
Throughout our life, we are conditioned to view money differently. For example, our salaries are kept secret from our colleagues, husbands and wives don’t disclose their earnings with each other, and parents don’t share financial information with their kids.
And while it is usually considered outright rude to ask someone how much they earn, in most cases, an individual will claim a higher earning capacity to impress their social circles. In other cases, many will instead downplay their assets, income, and investments to keep from being asked for handouts, assistance, or gifts.
I get it. Money is a sensitive topic. The sensitivity is ingrained in us from our foundation years, and thus for us to seek advice in managing our money better is a deeply personal and private conversation.
Our financial planners are looking to support people that are looking to have a relationship, not a transaction.
We believe people deserve access to financial advice and advisors. People deserve to get affordable and meaningful help from financial professionals.
We, as financial planners want to help as many people as possible.