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The true value of a financial advisor

“Every Canadian should have some sort of a financial advisor,” says Manish Kaushal, Associate Vice President of Wealth and Steinbach Retail. So why don’t they? And why should they? Traditionally, the service has been provided mostly to the affluent. But with recent reports from the Financial Planning Standards Council showing that two-thirds of Canadians (67%) are uncomfortable with their financial future, perhaps it should come as no surprise that more and more people are wondering what a financial advisor could do for them.

“It’s like having a good doctor,” Kaushal explains. A good doctor comes in and asks a lot of good questions the first time they meet you. They look at your history, they look at what’s ailing you, they ask what’s keeping you up at night. They ask about your habits and behaviours. They come up with a plan to keep things good or make them better. And they check in on a regular basis to see if you’re following the plan they helped you set up. Are you getting that nutrition? Are you exercising? Did you fall off the plan and do you need help getting back on? Did you find out about a new health risk that we need to adjust for?

What doctors and financial planners really have in common is this: They know your future wellness depends on taking care of yourself now. Or, as Kaushal puts it, “Your financial destiny is pre-determined. It’s based on the actions you take today.”

Of course, in money as in health, the right actions can be easier said than done. Events and emotions can threaten even the best laid plans, but that’s precisely when an advisor really shines. “People get very emotionally ingrained in decisions about money and children,” says Kaushal. “They hold those close to the heart. That’s how emotional investing comes up.”

For example, most people understand that markets go up and down. If you ask people when they think are the best times to buy and the best times to sell, most will answer correctly: Buy low, sell high. But real life can be more of an emotional rollercoaster for investors. It’s easy to lose confidence when markets are low, and tempting to cut losses and sell.

The ability to steer the ship during tumultuous times might be the greatest value of a financial advisor, and it explains why a strong, transparent relationship is so important. The more open the dialogue you have with your advisor, the better the experience will be. “There must be honesty on both sides of the desk,” Kaushal says. “The advice an advisor gives you is based on the information you provide. And if something makes you uncomfortable, if you see something out there that doesn’t make sense, let’s talk about it. Don’t panic. Don’t get spooked.”

The bottom line is that if you want the future you envision for yourself, you should commit to getting the guidance you need to get there. So if you understand the value of a good doctor, maybe it’s time you treated your finances to a checkup.

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