An interesting response from last week’s topic of “Is your financial advisor a planner or salesperson?” is that rather than spend money to get a financial planner, one should consider the route of “Free” D.I.Y. Financial Planning.
D.I.Y. means DO-IT-YOURSELF – it is essentially referring to one taking on a task in an area without engaging the direct aid of experts or professionals.
In this day and age where almost every answer to a problem or question can be found on Google or YouTube, the DIY activity is somewhat an industry in itself with various DIY articles, videos and even books dedicated to the subject. And with so many financial tools at one’s disposal online, it is easy for one to take on the role of becoming one’s own financial planner.
Which means, going the DIY route DOESN’T really GUARANTEE that you will be SPENDING NOTHING OR LESS.
If you ask, a financial planner (Like a Doctor) will likely say yes, hire me, I can help you achieve your personal finance goals. On the other hand, the do-it-yourself crowd dislike that idea, saying hiring a pro is a waste of your hard earned money (and sometimes these so-called DIY advocates are selling a financial product themselves – cough ..hypocrites.. cough).
The decision between hiring a pro or go the do-it-yourself route is not that simple. My top of the head answer is “It really depends on you and your personal situation”. It depends on how much or how little you want to be involved and how much WORK you are willing to do on your own.
Hire and Get help from a Pro
1. A professional financial planner can look at your situation from an unbiased viewpoint. If you are in the middle of a personal finance crisis such as a sudden life change, either good or bad, it is so easy to become emotionally overwhelmed. Consider that your adviser may be able to pinpoint options/strategies and opportunities that you can’t see.
2. When your life situation changes, your personal financial choices get increasingly complex. For example, a married couple with kids has to figure out tuition, retirement and investment plans, mortgage, elderly care and so on. A personal financial planner can help you sort through all of these options.
Going the DIY Route
1. You are in complete control — nobody cares more about your money than you do, but you have to accept both the potential gains and losses by going the DIY route.
2. As I mentioned earlier, the information is already out there. If you are willing to take the time to educate yourself, you can find most everything available online. YES THESE ARE FREE, but don’t forget to consider “the cost of trial-and-error” as well as your own Learning Curve may be fast or slow; add to that, implementing or executing your strategy may still end up in you spending more money than you thought (once again, DIY is an industry).
So, should you hire a pro or should you go with the do-it-yourself route? As you can see from the above, there are valid arguments on both sides of the issue.
End of Part 1 (stay tuned for part 2)
The writer is an RFP® - registered financial planner of RFP PH, Licensed Real Estate Broker and Director of CERTA, Inc., a family estate planning and investment advisory firm. To know more, please visit www.certa.ph
Originally Published in Philstar - The Freeman Newspaper last September 27, 2016.