Financial advice: much more than the bottom line

The true value of financial advice clearly goes well beyond simply maximising the monetary value of a client’s portfolio. As we progress through life’s journey, the major events that confront us all certainly come with financial costs. However, they also generate an array of emotions and feelings, and the provision of advice has a critical role to perform in this area too. 

Building a portfolio 

Analysis¹ suggests the value of advice can be broken down into four pillars: portfolio, financial, time and emotional. Firstly, by working with an adviser, clients are able to construct, and rebalance when necessary, a well-diversified, tailored portfolio of investments that match their risk tolerance and enable them to achieve their life goals. 

Financial and time value 

Financial value essentially revolves around planning for expected and unexpected events, with help provided in a range of areas, including saving and spending strategies, legacy and estate planning, and tax efficiency. Time is clearly one of our most valuable resources and, by securing the services of an adviser, clients are able to devote more time to the things they actually enjoy doing. 

Peace of mind 

The final pillar, emotional value, focuses on financial peace of mind. This aspect of advice is often highlighted in research studies, with one survey⁹ suggesting three times as many investors report having peace of mind because of their adviser. In essence, the advice process allows clients to feel at ease and promotes confidence in the outlook for their financial future. 

¹Vanguard, 2022 and 2023 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.