5 Common Misconceptions About Registered Investment Advisors

5 Common Misconceptions About Registered Investment Advisors
Written By
Carl E. Sera, CMT
Published On
June 15, 2023

Making investments alone can feel intimidating, so hiring a registered financial advisor can relieve some stress. However, don’t let the myths get in the way of obtaining helpful advice from a specialist. Here are five common misconceptions about registered investment advisors.

All Investment Advisors Are Similar

A well-known myth about investment advisors is that they all have the same mantra, services, and end goals for their clients. However, disparities in their business practices and qualifications are considerable because they don’t have coverage by federal regulation or uniform state rules. Some focus on specific services, while others focus on a particular area, like investment planning.

Only Wealthy Clients Use Investment Advisors

Many people assume only wealthy people use financial advisors. In truth, registered investment advisors require their clients to have some discretionary income, while others need a minimum amount of investment assets. Some investment advisors require small budgets to achieve the largest impact while helping clients achieve their goals. These can include college investments or business succession.

All Investments Go Into High-Risk Stocks

One common myth about investment advisors is that they put their client’s investments into risky, intimidating stocks. Realistically, professional investment advisors ensure clients have stable, short-term savings for large purchases or emergencies. If the client can appropriately invest in the long-term account, stocks may become involved.

Most investment advisors establish a diversified and balanced portfolio for their clients. Before doing so, they assess a client’s portfolio and risk tolerance to ensure the investment strategy works for the individual.

Investment Advisors Treat Clients Like Children

While some investment advisors speak professional jargon without consideration, many registered investment advisors will guide their clients and patiently explain every step of the process. It’s crucial for clients to remember the money they put into investment results in educational, helpful advice and guidance over investing in stocks, bonds, and other methods. Investment advisors must treat their clients with respect and integrity, as they trust advisors to help them achieve their financial goals.

Investments Advisors Aren’t Worth the Money

A common misconception about registered investment advisors is that they aren’t worth the cost. However, professional investment advisors ensure clients' fees remain valuable, giving them the confidence to reach their financial goals. Clients don’t need an exorbitant amount of money, nor do they have to be a certain age to receive exceptional services to meet their financial goals.

Sera Capital focuses on giving clients with highly appreciated assets education and advice to reach their financial goals. Our exit planning strategists aid clients in portfolio diversification, asset settlement, and many other services to help investors reach their end goals and reach into the following generations. If you have any questions about our services, schedule a free 30-minute call today.

Carl E. Sera, CMT

Carl E. Sera, CMT

Managing Principal, Sera Capital
Carl Sera is a Chartered Market Technician and the Managing Principal at Sera Capital Management, LLC. He has over 14 years of experience in the financial services industry with a focus on investment management.

Secure Your Free 30-min
Consultation Today

Schedule Consultation