What A Registered Investment Advisor Can Do for You

The types of investment vehicles available nowadays are diverse and exciting. While the options for maintaining and maximizing wealth have never been greater, the number of choices can be puzzling, even for seasoned do-it-yourself investors. Extracting useful information from the internet can be a challenge, given the often contradictory advice. In addition, the tips you may receive could be useful for one type of investment, and not another. High-worth individuals often opt for a Registered Investment Advisor to help sort through data advice and to develop a comprehensive plan for growing wealth.

More Than a Fund Manager

In the old days, a typical advisor would call up a client and with a hot stock tip or to pitch an investment idea. Many of these advisors were qualified, while others were like sales people. Since many retail stock investors have access to online information for researching stocks, these tips by phone are less popular. In addition, more investors place their money into mutual funds rather than individual stocks. While a fund manager provides information to clients on a scheduled basis, it may be hard for an individual investor to reach a fund manager and ask specific advice.
A competent fund manager is qualified and has the training and experience to put together a sound portfolio of stocks. However, he or she may not be so adept and dealing with individuals and their questions. In addition, it is recommended that investors have diverse holdings in several types of investment vehicles, such as stocks, hard assets, real estate, and bonds. A mutual or hedge fund manager has only one piece of your investment puzzle. In addition, the manager may explain to you the decisions he or she made, but may not be able to direct you towards the best overall strategies.

How an RIA Works

An RIA works on behalf of high net worth individuals, defined as those who hold assets of one million dollars or more. RIA firms hire researchers, portfolio managers, traders and other experts to collect and analyze financial information from various sources. Your Registered Investment Advisor meets with you to discuss your financial goals and ideas about achieving them. After looking at your present investments, assets, and ideas about increasing wealth, he or she will form a strategy that involves a diverse portfolio of investments. The advisor will be in contact with you regularly to discuss your portfolio and other options as they arise. He or she will also update you on changes in the market or other factors affecting your holdings.
An RIA is paid through a management fee combined with a percentage of assets, usually about 1%. The fee is often revised downward if there is a larger than average number of assets held. The manner of charging and the amount often varies and depends on the client and the type of assets. Some advisors work independently, while others are a part of large firms that manage hundreds of portfolios. Qualified RIAs should hold licenses and be registered with the Security and Exchange Commission.
To find an investment advisor, it may be helpful to discuss options with friends and family who are happy with their advisors or to conduct research online. Consider an advisor or firm?s reputation and look at their website and articles for keys to finding those who provide advice geared towards your financial goals. Many advisors, such as Fisher Investments, have websites that provide financial information and encourage the visitor to inquire further.

A Word About Retirement

In addition to general asset management, many Registered Investment Advisors have particular expertise in the area of preparing for retirement. With growing worries that Social Security may not be sufficient down the road to cover retirement, more Americans are using the services of financial advisors for peace of mind. In addition, advisors can outline strategies to assist those who are aiming towards early retirement or to improve their quality of life in retirement.

Hire an RIA to Maximize Your Wealth

With a growing number of investment opportunities, it doesn?t pay to be on automatic pilot when it comes to your assets. A Registered Investment Advisor will take a pro-active role and involve you in the process of growing your assets and preparing for a comfortable retirement. For a reasonable fee, your advisor can open the door to new options for your portfolio and to facilitate growth to increase your wealth.

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