Why are there no financial advisors for people with smaller incomes?
There is a large market out there and no one seems to want to tap it. Yes, it woud take a while to build but there are a lot of people, like me, who need help managing their finances -including credit issues, budgeting and retirement/investments – but we don’t have the big bucks. Maybe if someone took the time to help us get there, we could be as profitable as the ‘big’ income guys. We just need someone to teach us how to get started. Maybe even a ‘mentoring’ service for the long term.
I know it’s not the traditional financial advisor role but innovation and change – that’s the name of the game. The game of making money.
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because we can’t afford them.
because they don’t have any finances to be advised about
They do – They are Consumer Credit Counseling Services – it is a non-profit and a few different ones out there… They are awesome and very helpful…
no profit
there are financial advisors out there that are volanteers to the cause of making money.Its at no cost to you.
why dont you start a group on the internet for ppl with the same interests and maybe you can all work something out and make the money you want.unfortunatly, everybody in this world is there to make money even the financers, if you have a good head on your shoulders you can work it out on your own , the world is your oyster and you can do anything you set your mind too. mostly everything needs a little layout for you too start making money, you cant start a business without a little capital…good luck
I know that this sounds like a comercial, but try going to an H&R Block office during tax season and find a preparer with a few years experience. Block’s vision statement is to become your tax and financial advisor and many of the seasoned preparers (tax advisor or above) have had training in retirement plans, employee benfit plans, and they even have a program through their bank for people who can’t get a traditional checking account. The seasoned preparers do not cost any more than the newbies, so ask for a old timer who likes to chit chat and you’ll get your taxes prepared and a financial lesson included.
Most money managers (and banks) are greedy. If there’s nothing in it for themselves = not interested!
I’m not an expert, but my guess is that there are 2 factors. The first is the fact that companies would probably not make as good a profit on those who can’t afford to pay big bucks. The second factor is just that those with smaller incomes have less to manage. A millionaire with various types of investments and multiple streams of income is going to need financial advisors to sort it all out. But someone living paycheck to paycheck (or with a few thousand saved in the bank) wouldn’t need that level of financial management.
Investment advisors work on a percentage of your assets under management. If you don’t have much money, nobody can really afford to spend any time with you and still pay their bills. So if you have, say $20,000 to invest (not a lot for an investment advisor), he or she will only be able to take one or two percent of that. Your $200 or $400 per year is not really going to pay for an office, advertising, access to financial data (one of those screens that tells you all the prices of things all over the world is over $2000 per month–the advisor would need more than one hundred small customers like you just to pay for the data screen).
That said, I spent 11 years as a stock broker. Here’s advice.
Credit cards are for suckers. Pay cash or do without. NEVER USE CREDIT CARDS. They are for suckers.
Pay your bills on time. Always. When you’re ready to buy a house, that will count for a lot.
When you buy a house, make 1 or 2 extra mortgage payments each year–the interest savings will add up to tens of thousands of dollars by the time your done paying.
Investing: Buy and contribute regularly to an “Index Fund” which carries the lowest fees and allows you to invest in a broad index of stocks like the S&P 500. When the “market” goes up, so do your savings. Good ones are the Vanguard S&P500 Index Fund, and a similar one run by Fidelity. Go online and contact these companies directly. If you are older and require income, go to your bank and buy Series II US Savings bonds. They pay an interest rate that is linked to inflation (II means “Inflation Indexed”). The younger you are, the more Index Funds you should own. The older you are, the more Savings bonds you should own.
A good rule of thumb is that you should own a percentage of savings bonds equal to your 1/2 your age (i.e. if you are 28 years old, use 14% of your money to buy savings bonds, the rest in S&P500 Index funds). Adjust this as you grow older. When you stop working, move all the money from the S&P 500 fund into the bonds and live off of the interest till you die.
Hope this helps. Its all free for you. And no “investment advisor” who lives off of sales commissions will ever tell you this (both of the recomendations I’ve given you are commission free).
Because the government regulates the industry so much that no advisors can afford to deal with clients that don’t bring in big payments. Every new regulation is costly, and many of the costs are related to the number of clients we bring in. Today, I can no longer afford to take on clients below a certain size, simply because of government red tape. I’ve tried hard to keep a certain amount of time available for small clients, but it’s becoming more and more costly to do so, and makes it harder for me to stay in business.
Because financial advisors make very small percentage on your investment, therefore they can’t survive on small investment accounts.
Your best bet is to read some books on no-load mutual funds and diversify your investment over different types of mutual funds. Stay on course regardless what the market does-up or down, invest the same amount every month over a long period of time. Rebalance your portfolio from time to time.
E-mail me and I’ll give you free advice about budgeting and investments. I don’t have anything to sell–I just like to get people to thinking and challenge the conventional wisdom about personal finance (challenge number 1: most of what you read about saving and investing is what mutual funds and other big advertisers want you to read, so it should be taken with a large grain of salt).
I don’t know anything about credit issues.
dear,
i can give u a very good website on finance,….actually it is going to be the best website for all by 2008…note down the site plse
http://knowledgeguruji.googlepages.com/home
Because truly, you really don’t need a financial advisor. A financial advisor is need when you have accumulated some wealth, or a life event (such as proceeds from lottery, a death in the family, etc.).
At your local bank you can set up an account and start investing in that. Put your money alittle bit at a time and it will accumulate. You are right, that’s how people get rich, Little bit at a time. At the local bank you can put your money into mutual funds or even open up an IRA account.
Truly, you do not need a financial ad visor at this time. And if you have debt now and want to figure out a budget plan, debt counselors help you with that.
Good luck.
I’ve always upheld that if a person is broke their whole life it is because they are stupid. There are lots of financial advisors that will work for an affordable fee or gratis. You can get the same information for free from books and online. There is no market for low cost financial advisors because broke people can’t handle money and never will.
Its simple economics. Most financial advisors want to deal with as few clients as possible and still make significant money. Of course the amount the want to make depends on the individual, however I have found that most advisors once they are established will start to cull their client list and keep only the clients that give them the least amount of “pain” and have significant investment portfolios. Its all about making the most money with the least amount of effort.
There are advisors that are just getting into the business that would likely accept your business. Of course if you continue to be a small investor you may face being dropped at some point in the future.
A great book for you to read is ” The Naked Investor” by John Lawrence Reynolds which is carried by most bookstores. It gives the reader an inside look at the business of financial advisors.