Do i have to Follow a Financial Planners Advice

In the way of Nature, there are no masters, only guides. The term “guru” is an advertising slogan, meant to generate profit and promote dependency. There is no natural reason to slavishly follow any expert’s advice, whether you are seeking spiritual enlightenment or material prosperity.

Thus, a financial planner is a guide. You hire an FP to help you with decisions that are ultimately personal to you. The FP you work with is (hopefully) an expert on money, law, taxes, and the various income vehicles (stocks, bonds, pension, IRA, mutual funds, etc.) that are available in the financial services marketplace. There may be some very compelling reasons not to follow an FP’s advice, which can include:

-an emergent or personally critical priority that you know is paramount to any long-term or other considerations that the FP is recommending to you. You can always put an FP’s advice on the back burner while you sort out more meaningful personal priorities in your financial life. You don’t have to reject the FP’s input, but sometimes it does have to be deferred.
-conflicting or incompatible bits of advice, as between a legal obligation and a personal one, sometimes have to be prioritized, and not always according to the FP’s recommendation.
-financial planning, like health care, sometimes benefits from the “second opinion.” Here, I’m not saying take Uncle Louie’s advice over the guy from Merrill Lynch; but if you have a particularly thorny financial situation that may call for a broader array of guidance than one professional may provide, then go for a second opinion and weigh them carefully.
-an FP who is working with you may not have either the expertise or the awareness in the particular arena you’re interested in, and that may take you in a different direction.
-a conflict of interest involving the FP himself. You have to be sensitive to this possibility: most planners are connected with a particular company, product, or line of services that they may have a vested interest in promoting. Be alert to this, and be ready to take advice that carries a hidden agenda with a grain or two of salt. This, by the way, is the time to look for that second opinion we talked about above.
-finally, life is dynamic, and events arise, situations change, and contingencies can appear that weren’t around when you had your last appointment.

In general, you, and hopefully your FP as well, will observe the following high-level priorities in reviewing any financial plan:

1. Staying on the right side of the law trumps everything. No profit is so big or potential so compelling to justify even bending tax law or SEC regs. The last place you want to be is in court (or jail) for having followed bad advice without a thorough consideration of the legalities first.
2. Next comes financial risk. You generally want to accept enough risk to allow for a tolerable loss should things go awry (because when that risk pays off, the profit is considerably higher than otherwise). But you also want risk to be measured and balanced enough so that you can recover from any reversal. If that isn’t in your FP’s calculations on your behalf, go elsewhere until you find someone who can do it.
3. Finally, there is common sense: and this is where your judgment may trump the FP’s. Take into account your age, your employment circumstances, family considerations, health, and any other aspects of your life situation that are unique to your portfolio planning, and talk them through with the FP from a variety of angles, going over each scenario and its possibilities. If he’s a real pro, he’ll show the patience and insight necessary to follow you through this journey. Analysis and statistical computation are all very well, but sometimes final decisions that will affect your future come down to the common sense conclusions that are led by the communication and coordination of heart and brain, mind and body-the balance between the numbers and the nose.