Image source: Getty Images
It’s not always easy to get good financial advice, but working with a financial planner can drive big gains in your brokerage account and overall wealth. A recent survey from Origin, a personal finance platform, found that when people work with financial planners, they tend to get much richer.
Origin’s survey found that when people work with a financial planner, they often see gains in net worth of 50% or more. This means that if you had $80,000 of wealth before you started working with a financial planner, getting professional advice might help drive your wealth to $120,000 or more.
Let’s look at a few reasons why working with a financial planner can help you get richer.
50% (or higher) gain in net worth
Origin recently released its State of Personal Finance Apps 2024 report, where the company surveyed more than 1,000 Gen Z members and millennials about their personal finances and investment goals. According to this survey, 66% of Gen Z and millennials have a financial plan, and 61% are working with a financial planner, financial advisor, or wealth manager.
Financial planners can help drive big results in your personal finances. The survey found that, among Gen Z and millennials who use professional financial planning help, 57% of investors saw increases in net worth of 50% or more.
How financial planners can help you get richer
Hiring a financial planner is not just for high-net-worth (“rich”) people, and financial advisors can do much more than just pick stocks or manage investments. Financial planners can also help you with the fundamentals of budgeting, spending less, and saving more money each month.
According to the Origin survey, here are a few of the most common ways that Gen Z and millennial investors say that professional financial planners are helping them:
-
Investment recommendations: 69% of respondents
-
Budgeting recommendations: 48% of respondents
-
Cutting unnecessary expenses: 44% of respondents
-
Outlining a savings plan: 35% of respondents
-
Smarter tax planning: 34% of respondents
Whatever stage of life you’re at, whatever financial challenges you’re facing, professional financial advice can help you save more money and build wealth faster.
Why hiring a financial advisor can drive returns
It can be hard to determine exactly why or how much a financial advisor improves your finances. Some people might feel greater peace of mind and confidence to make investment decisions after talking with a financial planner. In the same way that going to therapy can help people feel clarity about their lives and make better-informed choices, talking to a professional financial advisor might help people feel better about their money and chart a path toward their financial futures.
But there is some evidence from Vanguard that shows how much a financial advisor can boost the numbers in your brokerage account. A recent Vanguard survey found that investors believe that a human financial advisor brings them 16% closer to their investment goals. For example, if you had $100,000 in your brokerage account, Vanguard’s survey suggests that a human advisor could help boost your portfolio to $116,000.
This doesn’t mean that financial advisors are always good at picking stocks. Many professional investment managers fail to outperform the S&P 500 Index in the long run. But human financial advisors can help guide and coach you to make better investment moves, such as:
-
Choosing the right investment allocation for your age, time horizon, and risk tolerance
-
Avoiding excessive fees
-
Maximizing tax-advantaged investment accounts like Roth IRAs and health savings accounts (HSAs)
-
Sticking with your long-term plan — such as continuing to invest consistently through the ups and downs of stock market volatility
And as Origin’s survey shows, many people use financial advisors to help save more money in the first place by setting budgets and outlining savings plans.
Bottom line
If you want to drive big gains in your net worth, hiring a financial planner, financial advisor, or wealth manager might be a good move. Recent surveys from Origin and Vanguard have found that people believe that they’re receiving excellent value and big returns from financial advisor services. But make sure your financial planner is a fiduciary who is ethically and professionally obligated to put your financial interests first — not just sell you financial products.
Alert: highest cash back card we’ve seen now has 0% intro APR until nearly 2026
This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!
Click here to read our full review for free and apply in just 2 minutes.
We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers. The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.
