What’s the value of a financial advisor?
Two studies found that working with a financial professional can result in higher returns and potentially lower personal stress.
Seventy-seven percent of people within 11-15 years of retirement are stressed when thinking about retirement savings and investments.¹
Working with a financial advisor to develop a written retirement income strategy, however, can increase your financial confidence leading up to retirement, according to Franklin Templeton’s annual Retirement Income Strategies and Expectations Survey.
In addition to providing financial guidance, financial advisors may also add about three percentage points in net portfolio returns over time, according to a study by Vanguard.
Financial Advisor Advice Components
Asset allocation Up to 1.2% (Potential Added Return to Investor Portfolio)
Rebalancing Up to over 1% (Potential Added Return to Investor Portfolio)
Managing investor emotions Up to 1.5% (Potential Added Return to Investor Portfolio)
These studies provided feedback and estimates based on customer experience at the two firms. The value of advice is not a guarantee of performance. The rate of return on investments will vary over time, particularly for longer-term investments. Actual returns will fluctuate. It’s important to remember that financial advisors also may offer guidance that wasn’t measured in the two studies. Advisors can help develop strategies that protect against the financial consequences of loss of income, and coordinate with other financial professionals on tax and estate management.
Franklin Templeton, 2016
Franklin Templeton, 2016
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