Having an investing strategy as part of an overall financial plan is an important way to save for the future and build wealth over time. However, making the right decisions can be challenging. That’s why people lean on professional financial advice to help them develop an action plan based on their financial goals and tolerance for risk.
While some people prefer meeting with an advisor, others want a do-it-yourself solution. That’s where robo-advisors come in.
What’s a Robo-Advisor?
A robo-advisor is an automated online platform that helps people invest with little or no human interaction. The investor chooses a provider and fills out a questionnaire regarding their financial aspirations. Then the robo-advisor builds an investment mix based on their goals and risk tolerance using advanced software and computer algorithms.
Robo vs. Real
Robo-advisors are popular because they offer low account minimums and fees, but like any technology, they have their limitations. That’s because they focus more on investment management than financial planning. A robo-advisor won’t act as a sounding board when you are tempted to make decisions that could hurt your finances, or guide you when your circumstances change. For instance, it’s easy to stop investing and keep your money on the sidelines because you think the market’s too risky. Or you may decide to buy too much car or home for your income, which could derail your long-term goals. A financial advisor can help you stay on track, answer your questions and help you work toward building lasting security.
When to Meet with an Advisor
Most experts agree that any time you have a major life change, getting guidance from a financial advisor is a smart move. Even if you’re just starting out in your career, an advisor can help you identify opportunities to invest and save for your future. If you marry and have children, you’ll want to safeguard your family’s security by creating a will, trust or both. You’ll also want to ensure you’re saving enough for retirement. A financial advisor can address these topics and more to help you build your own financial road map. Then you can check back in with your advisor periodically to review and update your financial plan if you need to.
Advice to fit your Needs
People often forego getting professional advice because they think it’s too costly, but many credit unions including SchoolsFirst FCU provide complimentary guidance from professional advisors as a benefit of Membership. If there are fees and expenses involved with your investing choices, they’ll discuss them with you and help you find the ones that are right for you. Despite the benefits of getting professional financial advice, many don’t take advantage of this service. In fact, according to recent statistics, half of Americans don’t have written financial plans, but those who do feel better about their security and are more confident in making financial decisions. Developing a financial plan will be one of the best things you can do for you and your family. To learn more visit schoolsfirstfcu.org/advisors
Meeting with an Advisor
If you decide to set up a complimentary consultation with one of our financial advisors, you may be wondering what happens next and how to prepare. It’s easy and straightforward. You’ll want to gather the necessary paperwork to help your advisor get a quick snapshot of your current finances and the financial goals you’d like to accomplish. Be sure to bring:
- A list of your top financial concerns as well as your aspirations, such as becoming a homeowner or planning for early retirement.
- Paperwork that shows your current income including W2s, 1099s, etc.
- A list of all monthly expenses.
- Investment statements including 401(k)s and IRAs.
- Life, health and auto insurance documents.
- Tax records.
Get Financially Fit This Year
No matter where you are in life, there are things you can do to improve your finances. Whether you meet with an advisor, use a robo-advisor, or choose to do it yourself for now, set some attainable goals such as creating a budget, tackling debt, starting or boosting an emergency fund, contributing to a retirement plan and creating a safety net for you and your family with a will or trust. Visit the advice tab on our website to see all the educational resources we offer to help you make the most of your money.
Securities sold, advisory services offered through CUNA Brokerage Services, Inc. (CBSI), member FINRA/SIPC, a registered broker/dealer and investment advisor. CBSI is under contract with SchoolsFirst FCU to make securities available to Members. Not NCUA/NCUSIF/FDIC insured, May lose value, No Financial Institution Guarantee. Not a deposit of any financial institution. CUNA Brokerage Services, Inc., is a registered broker/dealer in all fifty states of the United States of America.
Extra Credit provides general information to help improve our Member’s financial lives. Every situation is different, so please contact us for guidance on your specific needs. The advice provided in Extra Credit is not intended to serve as a substitute for speaking to a loan representative, financial advisor, or GreenPath Financial Wellness counselor who can help tailor a solution for you.
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