The Pros and Cons of Hiring a Financial Advisor In an age of information and accessibility, there remain decisions that require more than a simple click or swipe. This is one of them...

By Luis Cortes Edited by Bill Schulz

Opinions expressed by Entrepreneur contributors are their own.

Whether hiring a financial advisor, or handling your own investments, you want to know what is happening with your money.

I've spoken to many throughout the years, but have yet to connect with one that has shown me a significant value proposition. However, if you decide that it may be the better option? There are a few pros and cons to consider.

Related: Are You Willing and Able to Retire at Age 55? Let's Run the Numbers

Pro: time

Hiring an advisor can save you a significant amount of time spent on research and studying different investment strategies. This is where you must weigh out the opportunity cost. Consider your bandwidth. Depending on the type of investment strategy you would like to take, managing a portfolio regularly requires your attention – especially around tax season.

Pro: strategy

An advisor may be more equipped to choose the most advantageous investment strategy for your long-term goals. This is important to consider for investors, over the age of 50, that are considering different accounts for retirement or tax purposes. When it comes to "wealth management"? It may be wise to seek proper counsel for more complex investing scenarios.

Pro: peace of mind

The most noteworthy advantage: You hand off the responsibility to a trusted source and remove yourself from the daily pressure of big decision-making. A significant challenge that many investors have early in their journeys is emotional investing. By removing yourself, you remove your feelings and limit the possibility of hasty buying and selling as the market fluctuates. If you do choose to manage your own portfolio, it would be wise to instead focus on financial coaching.
Related: A Monk-Turned-Financial Advisor on Mindful Money Management

Con: peace of mind

This one is a simultaneous pro plus con. When you hand off your resources to another party, you also lose the comfort of knowing why your money is fluctuating. Even with a trusted advisor, there is no "100% guaranteed success" in the stock market. You are still the one who has to bear great losses. Your advisor? Less so. You'll want to know enough to monitor any financial advisor you are working with. True peace of mind will only come with more education.

Con: conflict of interest

When you are shopping for an advisor? Ask tough questions. Know the respective candidate's net worth and personal financial track record. Before you let someone manage your resources, it's a good idea to understand how they manage their own.

Con: costs and fees

If you are only investing a minor sum, you may find that even a small financial advisor fee will eat up a larger percentage of your returns since smaller accounts typically have higher fees. Advisor fees typically decrease the more funds you invest. You may also find that many of them offer reasonable fees given the competitiveness that has increased in this field, both online and off. Ask yourself: Will I reach my goals sooner with or without an advisor after fees are paid?

When negotiating, incentivize them to lower your fees as you increase your investments, or bring in friends to work with them as well.

If you have not yet made a decision and wish to connect with me directly, connect through my website via The Hustle Made Me Do It! or DM me on social media.
Related: Want to Become a Millionaire? Follow Warren Buffett's 4 Rules.

Luis Cortes

Investor | Serial Entrepreneur

Luis Cortes is an investor and entrepreneur with more than a decade of experience leading and building teams. Cortes started his career working fast-food minimum-wage jobs, ultimately finding success in high-level corporate America. Cortes most recently acquired Red Bicycle Coffee in Nashville.

Want to be an Entrepreneur Leadership Network contributor? Apply now to join.

Leadership

Lead From the Top: 5 Core Responsibilities of a CEO

Knowing exactly what the chief executive's role entails is critical for steering a company to success.

Side Hustle

This Couple Started a Side Hustle to Improve a 'Terribly Made' Bathroom Essential. Now the Business Earns More Than $3 Million a Year.

Michael Fine and Lisa Schulner-Fine launched lifestyle brand Quiet Town in 2016 and have been growing it ever since.

Business Ideas

70 Small Business Ideas to Start in 2025

We put together a list of the best, most profitable small business ideas for entrepreneurs to pursue in 2025.

Social Media

Learn How to Become a Successful Online Content Creator for Only $35

Discover ways to use AI to make viral videos, a successful blog and more, plus the principles behind freelancer and entrepreneur success.

Leadership

I've Seen 25 Years of Change in My Career — These 3 Lessons Every Business Owner Should Know

The business world moves fast, and you're already behind if you're not keeping up!

Business News

Want to Be the Next CEO of Jack in the Box? You Have to Be Really Good at Fortnite.

The fast food giant and Fortnite have a simple question: Do you have what it takes to be Jack in the Box's next CEO?