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Investing could help you to make a return on your savings. But what is the best way to maximise this return? And how can you reduce the risk of losing your money if disaster strikes?
By hiring professional help when investing, you can get answers to these questions. You can even hire people to manage your investment for you, reducing the stress of constantly having to monitor your investment.
Of course, there are fees involved when doing this, plus you need to be able to trust that the professional you hire is capable and honest. As a result, some people may find that it’s simpler and safer to not hire help.
This post compares the different ways in which you can hire professional help when investing. It also explores their benefits, as well as the benefits of investing alone, so that you can make the best choice.
Should you hire a professional advisor?
A lot of us have a very limited understanding of investing. We may have a basic knowledge of how things like stocks and buy-to-let property works, but many of us are clueless when it comes to the details such as what fees you need to pay and what legal requirements you need to abide by.
While you can read books and blogs to gain the information you need, a book or blog can’t always give you the advice you need suited to your personal circumstances. By hiring a financial advisor that specialises in investing, you can receive personalised advice on all the options that are available to you. You can also get answers to any niche questions that you may have.
Obviously, you need to make sure that this advisor has a good reputation and that they’re not likely to give you biased advice. You’ll generally have to pay a flat fee upfront. It’s worth noting that you don’t have to take their advice and that you could hire several different advisors if you wanted to in order to get a variety of opinions.
Should you hire investment management?
Investment management involves hiring a professional to physically take care of your investment for you rather than simply offering advice. This could include a stockbroker buying and selling stocks on your behalf, or a property manager that takes over the duty of managing property repairs and communicating with tenants.
Investment management allows you to outsource all the hands-on work. With things like property investment, it could allow you to invest in a property that isn’t local to you. Meanwhile, with stocks or forex, it could prevent you from having to constantly check in on prices.
Of course, you need to weigh up the cost of the investment management fees involved, which will usually be ongoing. You also need to hire someone who you can truly trust will take good care of your investment. It’s worth taking your time to compare the best brokers or the best property managers in your area. Read reviews to check they’re reputable and check what fees they charge.
Are you better off investing alone?
You may be able to learn the ropes without hiring an advisor, and you may find that you’re able to take on the hands-on role of managing your investment without help. It depends a lot on how confident you feel doing it on your own.
How much money you invest can also make a difference. If you’re only investing a small amount of money, you probably shouldn’t hire help – you don’t want the fees to be higher than your return.