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Ed Meek
CEO/Investment Advisor

Edge Portfolio Management

City:Winfield

State: IL



BIOGRAPHY:
At Edge, a low client to advisor ratio allows for personal and customized service for each individual.  Our goal is to work as a team for each client to provide not only portfolio management but wealth coordination and financial planning.  We make every effort to have frequent communication with our clients and to provide timely response to calls and emails.  I also enjoy spending time with my wife and three kids, playing and following basketball, playing golf, and participating as an advisory board member for Breakthrough Urban Ministries.

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Why Don't Self-Directed Investors Use a Financial Advisor?

Even more than confidence in their own investment abilities, non-Millionaires wonder if a financial advisor would work in their best interest.

| BY Donald Liebenson


Roughly four-in-ten non-Millionaire investors are self-directed, meaning that they make all of their financial and investment decisions without consulting a financial advisor.  What are the factors behind this independent mindset?

According to a new Spectrem’s Millionaire Corner wealth level study of households with a net worth between $100,000 and $1 million (not including primary residence), non-Millionaires are more likely than their Millionaire counterparts to be self-directed investors (39 percent vs. 30 percent).

The primary reason for 36 percent of non-Millionaires who elect to go solo regarding their wealth management and financial planning is that they do not believe that a financial advisor would be looking out for their best interests. Three-in-ten do not believe that they have enough assets to warrant having a financial advisor.

But part of their self-directed stance is related to their own confidence in their investment acumen. Twenty-eight percent proclaim that they can do a better job of investing than a professional. For 27 percent, it’s a matter of money—they state they cannot afford a financial advisor.

Not surprisingly, the youngest non-Millionaires surveyed ages 35 and under are the most likely to believe that they don’t have enough assets to warrant having a financial advisor, while Gen-Xers and late Baby Boomers ages 45-54 are the most likely to believe they cannot afford one. The youngest non-Millionaires are also the most likely to say they don’t use a financial advisor because they get help from friends and family (25 percent vs. 9 percent of respondents overall).

Seniors ages 65 and up are the most likely to be war of an advisor looking out for their best interests (40 percent). They also have the most confidence in their own investment knowledge and abilities (39 percent).

There also seems to be some confusion among non-Millionaires about whom they would use as a financial advisor. Thirty percent of those ages 36-44 said this sticking point was keeping them from using a financial advisor, compared with 19 percent of those ages 45-54 and 15 percent of Baby Boomers ages 55-64.

It is also not surprising that respondents who identify themselves as self-directed investors are slightly most likely to state that they could do a better job of investing their a professional.

 



About the Author


Donald Liebenson

dliebenson@millionairecorner.com

Donald Liebenson writes news and features for Millionaire Corner. He has been published in the Chicago Tribune, The Chicago Sun-Times, The Los Angeles Times, Fiscal Times, Entertainment Weekly, Huffington Post, and other outlets. He has also served as a marketing writer for Chicago-based Questar Entertainment and distributor Baker & Taylor.  

A graduate of the University of Southern California, he is married with a college-age son. He also writes extensively about entertainment.