June 26, 2007, 1:39 am

Financial Cliché IV: A financial consultant is required to become wealthy

by: The Financial Blogger    Category: Financial Cliché
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This is definitely a highly debated topic. I recently heard about a US study on the added value of a financial consultant managing your personal finance. They were explaining that in most cases, the investment portfolios were not showing a better performance with the help of a financial consultant. There are several good and bad points to financial consultants but one thing is for sure, you don’t necessarily need one to become wealthy.

In fact, several individuals are doing just fine without them. They created assets generating sufficient income to meet their needs and they are fine with that. Some others don’t believe in the stock market and invest in real estate properties or other assets. I can’t really blame them after the techno bubble and other market’s fluctuations.

You can also learn everything by your own and be a pro of personal finance. There are enough resources on the internet (such as this blog and many others!) that you can make your own decision and create wealth from your own knowledge.

If you are not passionate about personal finance or you simply feel unsecured to manage tax laws or leveraging strategies, I strongly suggest you get a financial consultant to help you out. The main point of this post is to reposition the role of a financial consultant. He should draw up the main guidelines and provide you with technical advices. However, you need to remain in control of your finance and be able to dig up if you don’t understand completely his explanation.

In the end, financial consultants are definitely a good support for personal finance. However, you don’t need them to be rich and there is no consultant that will make you a millionaire if you can’t get it done by your own. They are there to help you out with what you have. Unfortunately, they are not magicians.

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If I wanted to get a financial advisor or find one for someone else, I would look for a minimum of a CFP designation, which shows they at least have taken some financial courses.

Mutual fund salespersons only need to take the IFIC course to be licensed which is a basic, simple course and not enough to be a financial advisor.


by: The Financial Blogger | June 26th, 2007 (4:50 am)

You got that right !
Being a mutual fund selesersons is just too easy. A CFP will not garantee you sucess but at least the person in front of you will have a decent education.

A financial consultant’s role is more than simply investing. He must educate you on estate planning, insurance, taxes, and anything financial related.

In addition, we shouldn’t use raw performances to keep scores between financial consultant. Many retirees are content with boring investments spitting out steady monthly income, even if the portfolio doesn’t beat the index.

Great thoughts guys!

Everybody has some balanced ideas! Don’t forget the risk management side of things like insurance etc.


Brian Poncelet, CFP

[…] I am definitely not convinced that you need a financial consultant to create wealth, I am even less convinced that an emergency fund is something useful! It is definitely a financial […]