Four Examples of How a Financial Advisor Could Add Value to Your Portfolio

Finding the right financial advisor can be a challenge. With so much information available online, some question whether they need one at all.

People who want to work with a professional also might not be asking the right questions. Should you just find the advisor with the best historical performance of picking investments? Is historical performance a reliable predictor of future results? What else is important beyond investment performance?

What to Look for in a Financial Advisor

Hiring a financial advisor comes down to finding someone who can strategically deploy plans that provide value, whether that’s time savings, a manageable strategy, or increasing the assets in your portfolio.

A financial advisor could outperform the market with a strategy such as stock picking, but results will likely eventually return to the mean over time. The right financial advisor can help add value by capturing market performance and reducing risk.

Strategic advice from a financial advisor could help increase the assets at work in your portfolio. And with time, the compounded value of strategic advice can make a dramatic difference on your estate.

Four Examples that Demonstrate the Compounded Value of Strategic Advice

There are many strategies that can increase the amount of capital available for investment in your portfolio. Browse the articles below to learn more about how strategic advice could create compounded value for the following financial plans.

  • Charitable giving. If you’re charitably inclined, explore tax-efficient ways to accomplish your giving, such as donating to a donor-advised fund.
  • Qualified small business stock (QSBS). Learn how strategic planning could be the difference between paying 23.8% federal tax and no federal tax when you meet the requirements for QSBS.
  • State income taxes. State income tax rates can range from 0% to over 13%, so your state residency can take a big bite out of your portfolio. Explore strategies around timing a change of residency to align with financial goals.
  • Stock option planning. If you have stock options, explore how proper planning can mean the difference between paying income tax at the 37% ordinary tax rate or the 20% long-term capital gain rate.

Even if you only earn market-based returns, you can see how the value of professional advice compounding over time could have a dramatic impact on your portfolio. Keep in mind that you aren’t limited to one or two of these strategies but may find the combination of multiple strategies most powerful.

We’re Here to Help

For an integrated approach to investment strategies, taxes, and estate planning, contact your Moss Adams professional. You can also visit our Private Clients Practice or Individual Investment Services pages for additional resources.

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