Again, you need some knowledge to know if the FA is 'good', you need to know what to measure. That's enough knowledge to DIY, and save all those fees.
While I am a DIYer and I
do save all those fees, I do see how my ideal FA
could be helpful to me.
I don't really need or want someone to invest my money for me. I don't really need or want someone to sell me something that he or she will be compensated for selling. In fact, I wouldn't want to buy anything through the FA. I would want
advice not sales information.
I don't need anyone to come up with arcane and difficult to understand products that I should buy. I am OK with mostly index funds (I do have some Wellesley).
Still, I can think of things where I really would like to get the advice of someone who knows much more than I do. And, while I do think I am somewhat educated on those stuff (have read several books, followed posts here and other places, and so on), I am not an expert. And, knowing what an expert - a true expert, not a salesperson - would say is not that easy to do.
I mostly lurk some at Bogleheads. There are some very knowledgeable people who post there, some of whom are well known and write some of the books/articles we talk about here. And, they don't always agree on everything! And this isn't because they are idiots. It is because some issues aren't that clear cut.
On some of those issues, knowing general principles is one thing. I think I know that part. But, knowing how to apply those general principles to the specific situation is not necessarily that easy.
Where I would sometimes wish could be obtained would be detailed, personalized advice applying to those general principles to my specific situation, where that situation is not typical. That is, some situations are very typical and general principles easily give a good answer. Other situations have nuances that may call for a different answer. I think this is an area where a true expert could help with giving advice.
The problem is that finding that advice can be difficult:
1. Most FA's are really salesmen, who aren't there to advise you but to sell to you. Even if the FA really does try to advise honestly, the FA has an inherent conflict of interest.
2. There are some free/cheap financial plans out there. We got one from Vanguard. It was OK as far as it went, but wasn't personalized very much to our situation. I could have predicted almost everything that we were advised.
3. Theoretically you could hire an FA and pay an hourly fee just to get occasional advice or even one time advice on specific situations. However, even in that situation you may have difficulty getting this. First, many FAs might not even consult with you except perhaps for a hefty fee as you aren't a regular customer. Even if the FA does so, the FA also has a vested interest in you becoming a continuing client and not just a one shot deal.
So finding a FA, who isn't someone who is selling to you and who doesn't manage your investments, but who is willing to analyze and give advice about your personal situations even though you may be only an occasional client, is not necessarily an easy task.
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