The Perils of Paying for Handholding
A financial adviser on selling during a market decline:
“They know that in hindsight, it wasn’t the best thing to do,” Mr. Hail said. “But it was what they had to do emotionally. Math and the mind don’t always add up.”
Alternatively:
Holly Hunter, a financial adviser in Portsmouth, N.H., advised many of her clients to sell, first in the summer of 2007, then again in February of this year.
“My folks need income,” she said. “They need to know they can pay their bills….There is no waiting time for things to come back around.”
Ms. Hunter estimates that two-thirds of her 80 clients are retirees. She met with clients individually to determine how much of their portfolios should be scaled back.
Even though she had her clients sell at a low, it made sense for their financial situation, not just their emotional situation.
There are two types of Financial Advisers:
- One tells you what you want to hear
- The other tells you what you need to hear
The first adviser above is great at holding your hand and comforting you as you make a bad financial decision. Make sure you are working with someone bold enough to examine your situation, and make you take the right move.