The best decision I ever made was to invest in my own financial education. Everything I have done is easily achieved by anyone else with a DIY mentality.
This means reading as much as possible, trying to learn from various sources, and connect the dots into a full blown financial plan.
This plan takes care of:
1. Income/Expense monitoring and improvement
2. Savings/Investments
3. Keeping costs low
4. Tax/Estate Planning
5. Continuous Improvement
After many years of managing my own finances, it's all second nature by now. Once things are set-up, it's mostly smooth sailing from there.
Mistakes can and will happen, but that's how one learns. If you start your journey right away when you have some modest initial amounts of capital at stake, those mistakes are going to be small. I believe it is better to miss out on tens of dollars of missed tax savings and optimization in the early days (mistake I made) versus potentially falling for an expensive mutual fund, private REIT or an annuity in the latter days (mistake many of my peers have made)
The best part of it is that knowledge accumulates, like compound interest. That knowledge is scalable as well.
If you know how to manage $1,000, you know how to manage $10k, $100k, $1 Million etc... Once you set up those basic processes, you can expand from there and grow
It's also very helpful to be involved in all aspects of the process myself, because I can see how one decision somewhere can make a huge impact today and down the road.
E.g. Contributing to a pre-tax 401 (k) today saves on taxes today, allows for tax-deferred compounding, and I could come out ahead if the tax rate at withdrawal/Roth Conversion is lower than the tax rate I save today.
In another example, seeing how for each say $1,000 I invest, I generate $20 - $40 in annual dividend income that keeps growing over time through dividend increases and dividend reinvestment. Most of it is taxfree due to smart planning.
I never used a financial advisor, but rather relied on myself and my education. There are plenty of resources online. The important thing is to have the desire to improve your situation.
Using a professional can be helpful, but you also need to have the knowledge to evaluate this professional, and making sure they are qualified, and competent.
If you do not know what you are looking for, someone may take advantage of you. It could be costly down the road.
Why did I never use a financial advisor?
Well, when I was just starting out, nobody cared for someone with a few thousand dollars. I was also skeptical of anyone that was trying to sell me solutions that could bring them commissions, but not really incentivize my financial well being.
I saved on a ton of fees over the past 20 years as well. And would likely save even more over the next several decades as well. Those fees compound too...
I do not believe I need a financial advisor today either, as I can manage estate on my own. I have found it very difficult to find a good adviser as well.
Identifying a good adviser is as hard as identifying the next Google. Plus, you need to evaluate not only how good they are, but you also need to evaluate how long would they be in business for. You do not want to be nickel and dimed in fees either and sold high commission products. (e.g annuities, high fee mutual funds)
I believe most individuals do not need a financial advisor, but can easily manage their net worth on their own. Thus saving in fees.
Most finances are not that complicated.
They only need to have the desire to learn, and the desire to keep learning and improving over time.
I personally love learning, and seeing how others do it. I try to get best practices out of it.
I am an extreme case, but I do not believe financial education is really that complicated. Once you get the basics right, it can all beset-up to be done on autopilot. Getting it right can also be done after reading a book or two or a few on personal finance and investments.
You just have to have the desire to get your financial house in order. Otherwise, you have to pay someone to do it for you.
An investment in knowledge pays the highest dividends.