Will Taylor - Digging into Financial Advice: Finding the Best Help for You to Invest

Digging
into
Financial
Advice

Finding the Best Help
for You to Invest

Will Taylor

Copyright 2020 Will Taylor.

All rights reserved. No part of this book may be used or reproduced by any means, graphic, electronic, or mechanical, including photocopying, recording, taping or by any information storage retrieval system without the written permission of the author except in the case of brief quotations embodied in critical articles and reviews.

This book is a work of non-fiction. Unless otherwise noted, the author and the publisher make no explicit guarantees as to the accuracy of the information contained in this book and in some cases, names of people and places have been altered to protect their privacy.

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Scripture quotations are from the ESV Bible (The Holy Bible, English Standard Version), copyright 2001 by Crossway, a publishing ministry of Good News Publishers. Used by permission. All rights reserved.

ISBN: 978-1-9736-8467-1 (sc)

ISBN: 978-1-9736-8469-5 (hc)

ISBN: 978-1-9736-8468-8 (e)

Library of Congress Control Number: 2020901700

WestBow Press rev. date: 02/10/2020

Table of Contents

In clear and direct style, Mr. Taylor helps us navigate through the maze of brokers, banks, insurance agents, and other financial service providers selling stocks, bonds, mutual funds, annuities, ETFs, CDs, commodities and alternative investments. Each chapter is bite-sized while being heavily infused with the wisdom of experience to candidly help you understand advantages and pitfalls of various categories of investments and motivations of investment providers. We emerge from the maze having unearthed many buried treasures of investment knowledge and with a new recognition that a personal financial plan supporting our own goals, based on our own situation is a vital and achievable compass for our financial journey through life. Insightful reading for young adults to senior citizens, modest wage-earners and wealthy.

Tom Richard

There Is Money to Be Made
Giving Financial Advice

Why should a fool have money in his h and
to buy wisdom when he has no s ense?

Proverbs 17:16 ESV

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Financial advice for the average investor is everywhere. High quality, competent, and accurate financial advice may be not so abundant. As this is being written, the stock markets appear to be on an endless rally with many new records being set. It is a time of robust joy as stock portfolios rise to new levels with almost no effort. There is very little concern about the quality or accuracy of information coming from the experts, as virtually all investments with any level of stocks are going up at unbelievable speed.

The current market conditions will not continue and may reverse in the time it takes to write this book on financial advice from the professionals. The rally will stop, and smiles will turn to frowns as gains disappear. It is the nature of the stock market; for evidence one only needs to look at history.

There is money to be made in the investment of publicly traded equities, but many do not understand the nature of the investment. Those who do seek help to invest often are subjected to poor and expensive advice that helps the salesperson more than the investor. The salesperson has little risk and can be more of a detriment than help to the investor who is taking the risk. We are going to look at the providers of financial advice to the average person and examine their motives and methods.

In todays world of electronic trading and record keeping, there are many methods to trade and own stock. Stock is a term that is the same for our purposes as equities and is defined by Investopedia as: A stock is a type of security that signifies ownership in a corporation and represents a claim on part of the corporations assets and earnings. The shareholders value in a company rises and falls as the stock price changes. If the company is doing well, then the stock price usually rises, and the shareholders value of their investment rises. On the downside, when a company is not doing well, the stock price usually falls, and the stockholders value of the investment falls.

The best of all worlds would be if a stock price only goes up. This, of course, is not possible but at times some stocks seem to be on an endless rise. Stock values that have risen from a single digit price per share to values in the hundreds or thousands can ignite a desire to own stock. The huge potential gain sometimes leads inexperienced investors to believe that a hot tip on a stock to buy will lead to an inside track and guaranteed wealth.

The key is to know which stock prices are going to rise and which ones are going to fall. If that knowledge was known, then the investor could invest only in the stocks that are rising, sell the stock at the maximum price before the price declines, and then invest in another stock that is rising. It is easy to see the desired result. Paying for knowledge that would tell the investor when to buy and sell would have immense value if the advice is correct and the price of the advice does not overshadow the gain from using the advice.

This is where the use of financial advice must be carefully considered. There are many methods to invest in stocks, but each has positives and negatives. Each service provider has resources for information and sources for current recommendations. While there are many jokes regarding the quality of data and value of adviser information, an adviser who genuinely cares for clients and provides realistic recommendations based on the clients needs and goals can be quite beneficial to the clients success. Conversely, advisers who care more about gaining additional assets to manage rather than provide quality care will do more harm than good.

Each investor has needs and concerns that can affect the specific makeup of his or her stock portfolio. Different reasons to invest include the need for income and/or asset growth, the need to have more or less risk and to use various types of equity investments such as individual stocks, mutual funds, and exchange traded funds (ETFs). This wide diversity of stocks, investors, and types of advice is what makes investing in stocks such a strange variation of players and opinions. We are going to examine the various players in the world of the stock market. It will not be an all-inclusive list but will list the primary players who the average investor would encounter.