As a certified financial coach, Ramsey Solutions personality Rachel Cruze teaches Ramsey’s seven-step plan — the Baby Steps — which are designed to help people take control of their finances and build wealth through intentional financial choices. But taking control of your finances doesn’t mean you have to do it on your own.
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In a recent YouTube video, Cruze shared that “a financial advisor is a must, especially when it comes to investing.” Why?
Here are four reasons Cruze thinks you should never handle your finances alone.
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Financial Advisors Keep Your Investing Plan on Track
The primary responsibility of a financial advisor is to help you determine your short- and long-term financial goals, recommend investment and savings strategies for reaching them and then help you stay on track.
An advisor’s expertise can also help you improve your investment returns, as Cruze explained: “Those that work with a professional to help them invest are ahead of those that don’t.”
According to data compiled by Fidelity, from various industry studies, you may increase your long-term portfolio returns by up to 5.1% with professional financial guidance.
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Financial Advisors Do More Than Just Invest Your Money
An advisor can help you make financial decisions regarding all areas of personal finance, from budgeting to taxes to retirement planning. These professionals work with you to set financial goals, create personalized plans for reaching them and provide advice on saving, investing, managing risk, and more.
Whether you’re buying a home, managing debt, starting a college fund, estate planning, or working on all of these things at once, a financial advisor can help you create a plan that supports these goals and your long-term financial security.
Cruze pointed out that even though you should trust your financial advisor to guide you in these decisions, you should also trust your gut and say no to any financial advice you’re uncomfortable following.
Financial Advisors Have Time When You Don’t
If you barely have enough time to update your budget, you probably don’t have time to evaluate your investment strategy as necessary.
Cruze said that a financial advisor’s job is to stay on top of factors like inflation and stock market trends and how they impact your investing strategy so you don’t have to.
“Investing is a really big part of building wealth, and you want to do it the right way,” she explained.
Financial Advisors Help You Make Non-Emotional Financial Decisions
You may think that you always rely on logic and reason when it comes to money, but emotions may play a more significant role than you realize.
According to Psychology Today, fear, greed and anxiety often influence financial decisions. For example, fear can lead to risk avoidance, limiting your ability to earn higher returns. Greed may drive you toward too much risk, on the other hand, leading to substantial losses. Anxiety might make you overreact to stock market drops, pushing you to sell rather than hold your investments.
A financial advisor can help you manage your emotions and, as Cruze said, talk you down before making an emotional decision that can disrupt your financial progress.
Do You Have Enough Money for a Financial Advisor?
Financial advisory services aren’t just for wealthy people. Cruze believed getting a financial coach or advisor is wise, no matter where you are on your financial journey.
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This article originally appeared on GOBankingRates.com: 4 Reasons You Should Never Handle Your Finances Alone, According to Rachel Cruze
