All too often, people are too quick to hand off their investment responsibilities and decisions to a financial advisor. This is not exactly the best idea if you are interested in becoming financially free.
The fact of the matter is that no one is better at managing your finances than you. Creating a better life for you and your family is up to you. Therefore, it is important to become financially literate and reduce the expense of working with a financial advisor.
Becoming financially literate provides you with greater power and sets an example for all who are around you. In fact, becoming financially literate is something that everyone should pursue at some point in his or her life.
Have you ever thought about how financial advisors are paid? You most likely suspect that their palms are being greased by some financial institution somewhere. You have probably heard the saying that there are no free lunches. Underneath that slick pinstriped suit is a thin disguise of commissions and fees, which have rotted the industry of financial services right down to the core.
Most of the time, the financial product that the financial advisor has the best grip on is the one that he or she is responsible for selling. Just as an insurance salesperson will enthusiastically promote insurance and a stockbroker will promote a basket of shares or individual stocks, a financial advisor does not differ.
It is important to understand that financial planning is not all about increasing wealth and prevailing in the market. It is about diversifying your portfolio, creating a budget, planning for retirement, paying off debt and much, much more. Therefore, it is easy to see that financial planning is more than just making investments and collecting income. You must also learn to reduce taxes, protect your assets and make sure that your dependents are cared for properly.
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