Intentional Voice

When Seeking Trusted, Wise Counsel About Your Money, Avoid This Common Mistake! (Oct 2022)

Financial Freedom

Plans fail for lack of counsel, but with many advisers they succeed (Proverbs 15:22 NIV).

Our plans are more likely to succeed when we seek wise counsel. Financial plans are no exception. When seeking financial advice, you’ll need to consider your goals and needs. Modern technology has made planning more accessible than ever, but tech-based solutions can only offer so much. So what are you looking for in an advisor, and how do you make that choice?

In general, individuals seek financial advice that checks the following three boxes:

  • Comprehensive
  • Personalized
  • Cheap

It’s possible to receive professional financial advice that fits two of these categories. It’s difficult, if not impossible to find an advisor that can meets all three criteria. Seeking out a long-term relationship with a trusted financial advisor is worth the investment of time and money. Don’t make the common mistake of looking for “cheap.” Instead, consider your values, goals and priorities and the worth that you place on building a long-term, relationship with wise counsel.

Personalized + Cheap Financial Planning

The newest trend in financial advice is automated investment planning. With low fees and small account minimums, these robo-advisor provide a low-barrier-to-entry way for people looking to start investing. These accounts are easy to open and use, and there are some personalization options available to adjust the advice based on risk tolerance and investment timelines.

Although these robo-advisor products offer benefits for certain investors, they are very limited tools. They are fully automated, so you’re interacting with an AI-based chatbot, not a person. Under those conditions, the depth of personalization and customization can only go so far.

The biggest challenge is that automated programs have a narrow focus. They are concerned only with investment portfolios. There are a lot of other aspects to a person’s financial needs, like budgeting, clear goal setting, risk and insurance planning, charitable giving strategy, estate, and tax considerations, and so forth, that just cannot be addressed by an impersonal, automated tool.

That impersonal nature also means there’s no one available to you who has your best interest in mind and can help you avoid mistakes or take advantage of opportunities. For example, during times of market volatility, many individuals are worried about their money and want to sell their investments. Most often, that choice would lead to more significant losses than if they’d weathered the market storm. A trusted professional advisor can look at a person’s individual situation and provide advice, guidance, and reassurance. A computer-based advising program simply cannot do that.

Cheap + Comprehensive Financial Planning Doesn’t Exist

The old adage “you get what you pay for” can quickly be seen in the financial planning world. Truly comprehensive planning cannot be automated. It relies on human relationships, not just between the client and the advisor but between the advisor and other professionals when appropriate (tax advisors, attorneys, Realtors, etc.). The long-term health of your finances are worth the investment.

Personalized + Comprehensive Financial Planning

A trusted professional advisor provides financial planning that is a lot more personal and hands-on. At first glance, they may not look much different from the portfolios offered by a robo-advisor. But investment options are just one small part of a much bigger puzzle. Look for an advisor that wants to build a long-term relationships, which allows them to offer significantly more personalized and comprehensive guidance, because a holistic view of finances can only come from a better understanding of who they serve.

First Steps in Finding Trusted and Wise Counsel in Regards to Your Money 

“Listen to advice and accept discipline, and at the end you will be counted among the wise” (Proverbs 19:2 NIV).

Your financial decisions are about a lot more than money. Money is just a tool. What really matters are your goals, values, priorities, needs of your family and other things that can’t be easily summarized by an algorithm. With so much of your identity reflected in your money decisions, the worldview of your financial advisor matters. One designation you can look for is a Certified Kingdom Advisor®. The CKA® training equips financial advisors to include biblical principles in the advice they give to their clients. As Paul wrote to Timothy, “All scripture is God-breathed  and is useful for teaching, rebuking, for correcting, and training in righteousness” (2 Timothy 3:16 NIV). What an incredible advantage professional financial advisors can have when they lean on scripture rather than rely solely on their knowledge? They will also strive to understand the families they serve and identify where they are on their stewardship journey. With this understanding, they can do their part to connect their clients’ resources to God’s Kingdom purposes.

In addition, look for a fiduciary financial advisor. A fiduciary advisor means they have your best interests at heart, as opposed to an individual that may be able to recommend investments or products that pay them a bigger commission and could cost you more. One of the best ways to know you are working with a fiduciary advisor is to look for a Certified Financial Planner®. The CFP® code of ethics states that all CFPs “must act as a fiduciary, and therefore, act in the best interest of the client.”

Finding professionals with the CKA® and CFP® designations are excellent steps to take on the path the seeking out wise counsel and to help you become the best steward of what God has entrusted to you now and into the future

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John Moore Associates, an investment adviser with the U.S. Securities and Exchange Commission is not affiliated with Family Life Radio. Any opinions are those of the author and not necessarily those of John Moore Associates or Family Life Radio.