“What is the value of having a financial advisor?”, “How can a financial advisor’s expertise benefit me more than doing the work myself?” These are a few questions we have received from prospects in the initial consultation. It is important for us to address these questions and help explain why you should choose one of our financial advisors to give advice, create a financial plan, and manage investments. It is our goal to provide you with a quality service and experience. We choose to build a valuable relationship with our clients so they feel confident and comfortable when reaching out to us during life’s many transitions.
At Shepherd, we have witnessed all the different ways people manage money. Especially, during the beginning stages of onboarding a new client. Some of these methods are more traditional and some are modern, such as utilizing technology though various software platforms (e.g. mint.com). Many people rely heavily on the internet and Google the information they are looking for. When it comes to professional help there are many options available apart from a financial planner; this includes bankers, lawyers, accountants, etc. A study called “Gamma in Action”, released and published in Morningstar, states that a financial planner can help you work towards reaching your financial goals. This is because the financial planner can potentially change and improve the client’s decision-making process.
A financial planner assists in helping you make better financial decisions by showing informational data. These facts are based on income, expenses, and goals. This then aids in determining a budget with the creation of your financial plan. Our financial planners are actively thinking ahead to suggest next steps to take. These steps are based on changes in one’s life or turning a certain age, for eligibility reasons. Some of the most life changing moments in a person’s life may include; increased salary, getting married, having a baby, funding college expenses, purchasing a new home, etc. Utilizing a financial plan can assist in determining the decisions you should make at each of these stages in life. We call your financial plan the Shepherd Living Plan and it is structured to be consultative and constantly evolving. The plan is customized specifically to you and cannot be applied to any other person. We pride our self on building your plan using both your emotional and intuitive characteristics as well as the factual data.
A financial planner is also beneficial in aiding or assisting money management to help you determine the appropriate strategy. A financial planner can assist you with; identifying potential financial resources, identifying tax deductions, analyzing investment portfolios, developing long-term and short-term strategies. At Shepherd, we have in-house investment management and each advisor is a part of the investment team at the firm. It is with this approach that we are able to provide you with holistic investment strategies. We use the Shepherd Living Plan as the road map for your investment strategy while also integrating your short- and long-term goals. Examples of this include, if you plan on purchasing a house in the near future we make the appropriate adjustments to work towards this goal. If you are interested in Environmental, Social and Governance (ESG) investing, because you are passionate about supporting companies that are environmentally conscious, we have models that assist in implementing these values. We are here to assist you and to serve you with the ability to make appropriate decisions that are in line with your life.
The study “Gamma in Action” focuses on a person’s decision-making abilities and does not concentrate on how much money they have. The study states that, “Gamma attempts to quantify the potential value of financial planning. The study focuses on five fundamental financial planning decisions/techniques: a total wealth framework to determine the optimal asset allocation, a dynamic withdrawal strategy, incorporating guaranteed income products (i.e., annuities), tax-efficient decisions, and liability-relative asset allocation optimization. Households are increasingly becoming responsible for more financial decisions, such as determining how much to save for retirement, how to invest those savings, and when to retire. These U.S. households typically lack financial acumen, and thus financial advisors can be better positioned to help improve their financial decision-making. A growing body of theoretical research, including our gamma research, has noted the potential value of advisors in a variety of financial domains” (Blanchett, 2019). However, empirical evidence on the topic is mixed and generally suggests households that use financial advisors do no better (or even worse) than those who don’t, especially when it comes to investment-related domains.
If you want to work toward improving your decision-making capabilities reach out to one of our financial advisors and they can help you begin the process to work towards improving your life and be more mindful.
Blanchett, D. & Kaplan, P. 2013. “Alpha, Beta, and Now…Gamma.” Journal of Retirement, Vol. 1, No. 2, PP. 29-45.Blanchett, D. P. 2019. “Gamma in Action: Financially Sound Households Get Advice from Financial Planners.” Morningstar Magazine. PP. 31-43.
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. No strategy or financial planner can guarantee success. Socially responsible investments may experience returns that may be lower than if the advisor made decisions based solely on investment considerations.
Investment advice offered through Shepherd Financial Partners, LLC, a registered investment advisor. Securities offered through LPL Financial, member FINRA/SIPC. Shepherd Financial Partners and LPL Financial are separate entities.