Fly Solo or Financial Pro: Is an Investment Advisor Right For You?

Some investors like to self-direct their portfolios, but for others, working with a professional money manager might make more sense. Which is for you?

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https://tickertapecdn.tdameritrade.com/assets/images/pages/md/Flying solo vs. financial professional, investment advisor
5 min read

Key Takeaways

  • Personalized investment management is more accessible to everyday investors than ever before
  • If you don’t have the time or resources to commit to researching and managing your portfolio, professional help may make sense

Personalized investment management used to be reserved for only the wealthiest. But that’s no longer the case. Today, there are a broad range of products and services that offer professional investment advice to investors of all types. Some individual investors look at all the available choices as an opportunity to customize strategies to fit their objectives, while others may find it a challenge to wade through it all. 

Are you the type who's willing to to invest on your own or would you rather go with a pro?

A do-it-yourself investor needs to consider that they’re potentially taking on an extensive and ongoing time commitment. Some people like self-directed investing and are willing to put in the time.

Individuals who want to spend less time managing their portfolio often choose to work with a professional investment advisor. In addition to offering investment advice, these consultants can serve as a sounding board and confidante, which might potentially offer reassurance during market fluctuations and useful in maintaining a steady course during rough investing weather. And, contrary to what you might think, there are financial professionals for many budgets; many of whom tailor their fees based on account size. The key is to shop around to find the one that offers the services you want at a price that suits you.

The approach you choose might come down to your own need or desire to have human support versus an objective asset allocation plan that can’t necessarily address to your concerns, but can still be built with your sensitivities and goals in mind.

Doing It Yourself

If you’re an investor with simple goals, you may decide to manage your investments on your own, in which case, you might consider creating a portfolio that offers broad diversification. Two possible solutions that an investor might want to consider are mutual funds and exchange-traded funds (ETFs). If you’re participating in your employer’s retirement plan, you’re likely already investing in them; although, mutual funds are the most common investment choice for these plans. Unlike your employer’s plan, which may only offer a handful of funds, you have a much broader list of choices for your individual portfolio based on your goals, risk tolerance, and time horizon. To help narrow down the choices, TD Ameritrade provides the Premier List, powered by Morningstar Investment Management, which includes top pick mutual funds that offers investors access to a diversity of funds to help them better pursue their investment goals. Additionally, TD Ameritrade offers the ETF Market Center with access to ETF screeners to assist clients in their search for ETFs to match their financial goals.

Seeking a Helping Hand

When you add in spouses, kids, home ownership goals, and more on top of retirement and other concerns, it typically requires a more comprehensive solution. If you’re looking for an integrated service that combines investment decisions with insurance expertise, real estate knowledge, a money manager or investment advisor, and tax and estate planning, a investment advisor might be worth considering. Advisors are a diverse group, ranging from wealth planners assisting wealthy families with multimillion dollar estates, to financial firm representatives who have broadened their product offerings, to independent registered investment advisor, many of whom are Certified Financial Planners(CFP®). Financial consultants often work with broker platforms, so you can keep your accounts on the platform you know and continue to monitor them easily. TD Ameritrade clients can get help connecting with a Registered Investment Advisor (RIA) through our AdvisorDirect® referral program, which offers introductions to independent RIAs

Managing Your Finances Both Ways

If you want to manage most of your household finances yourself, seeking assistance for your investment strategy with the help of an investment consultant or an investment advisor might be something to consider, and you have several levels of service to choose from:

  • Automated investment solutions (robo advisor). This has become a popular option, as it combines low cost with a level of customization. Essential Portfolios, offered by TD Ameritrade Investment Management LLC, uses innovative technology to build and manage low-cost ETF portfolios. A client answers a few questions about their investment goals and risk tolerance to receive a portfolio recommendation to suit their financial goals. The portfolios are professionally managed and automatically rebalanced so the ongoing time commitment is minimal. 
  • Managed portfolio solutionsSelective Portfolios offered by TD Ameritrade Investment Management LLC combines human insights with an online experience to help an investor pursue their goals.  The model portfolios are monitored and automatically rebalanced for the investor, and financial consultants are available to offer guidance an support. 
  • Tailored portfolio solutions. This is a high-touch, high-tech solution where products like Personalized Portfolios from TD Ameritrade Investment Management, LLC blend one-to-one advice with technology to create a unique investment portfolio tailored to your financial situation. 

All of the managed portfolios offered by TD Ameritrade Investment Management, LLC, are goal-oriented portfolios built on recommendations from the professionals at Morningstar Investment Management, LLC. TD Ameritrade Investment Management professionals provide ongoing monitoring, allocation, and rebalancing.

Investors today have more choices than ever before for creating an investment strategy that aligns with their goals. To keep from getting overwhelmed, walk through your own level of knowledge and interest and think about how much time you can devote to researching investments. Then, before signing on any dotted lines, consider the suitability of the investment solution you’re selecting, and make sure you understand its fee structure and access to human support.

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All investments involve risk, including loss of principal. Past performance does not guarantee future results. There is no assurance that the investment process will consistently lead to successful investing. Asset allocation and diversification do not eliminate the risk of experiencing investment losses.

Mutual funds are subject to market, exchange rate, political, credit, interest rate and prepayment risks, which vary depending on the type of mutual fund.

ETFs can entail risks similar to direct stock ownership, including market, sector, or industry risks. Some ETFs may involve international risk, currency risk, commodity risk, and interest rate risk. Trading prices may not reflect the net asset value of the underlying securities.

The Premier List represents what Morningstar believes to be the ‘top picks’ funds in each category, from the universe of no-load funds with minimums less than $10,000 and open to new investors available on TD Ameritrade’s platform.

Morningstar Investment Management LLC is a registered investment adviser and subsidiary of Morningstar, Inc. The mutual funds selected by Morningstar Investment Management for the Premier List have been derived from a universe of mutual funds made available through TD Ameritrade, a universe which does not include all mutual funds available in the marketplace. Both the universe of mutual funds defined by TD Ameritrade and the Premier List are subject to change at any time and without notice. Particular mutual funds on the Premier List may not be appropriate investments for you under your circumstances, and there may be other mutual funds or investment options offered by TD Ameritrade that are more suitable. Morningstar Investment Management may have more favorable opinions of certain mutual funds which are not included in the universe of mutual funds made available through TD Ameritrade. The Morningstar selections were based on qualitative factors and quantitative analysis conducted by Morningstar Investment Management. The information, data and opinions contained herein include proprietary information of Morningstar Investment Management and may not be copied or redistributed for any purpose. Morningstar Investment Management does not warrant this information to be accurate, complete or timely. Morningstar Investment Management is not responsible for any damages or losses arising from the use of this information. Past performance is no guarantee of future results. The Morningstar name and logo are registered marks of Morningstar, Inc. Morningstar Investment Management is not affiliated with TD Ameritrade.

Minimum asset level required. There is no charge or obligation for the initial consultation with the independent advisor.  Once you select an independent advisor, you will pay advisory fees and standard brokerage fees.  Brokerage transactions executed through TD Ameritrade are subject to standard transaction charges.  You should review an independent advisor’s Form ADV, other applicable advisor disclosure document(s) and the AdvisorDirect Disclosure and Acknowledgement Document prior to engaging an independent advisor. The Form ADV contains important disclosure information relative to an independent advisor’s services and fees.  Independent advisors charge an ongoing investment advisory fee for their services.   Independent advisors will pay TD Ameritrade fees for their participation in the AdvisorDirect program. Those fees will usually constitute a percentage of the advisory fees you will pay your independent advisor. For additional details about the fees paid to TD Ameritrade and other conflicts of interest, please review the AdvisorDirect Disclosure and Acknowledgement Document and ask your independent advisor about its specific arrangement with TD Ameritrade. You are solely responsible for evaluating any independent advisor that you are considering.

Please note: Under no circumstances should participation by a certain independent advisor in AdvisorDirect be considered an endorsement or recommendation by TD Ameritrade for that particular independent advisor.

TD Ameritrade Investment Management and TD Ameritrade provide periodic comprehensive reporting services, which can incorporate all of the client’s investment assets including those investment assets that are not part of the assets managed by TD Ameritrade Investment Management (the “Excluded Assets”). The service relative to the Excluded Assets is limited to reporting services only, which does not include investment implementation. Because TD Ameritrade Investment Management and TD Ameritrade do not have trading authority for the Excluded Assets, to the extent applicable to the nature of the Excluded Assets (assets over which the client maintains trading authority vs. trading authority designated to another investment professional), the client (and/or the other investment professional), and not TD Ameritrade Investment Management or TD Ameritrade, shall be exclusively responsible for directly implementing any recommendations relative to the Excluded Assets.

The client and the client’s advisors that maintain trading authority, and not TD Ameritrade Investment Management or TD Ameritrade, shall be exclusively responsible for the investment performance of the Excluded Assets. Without limiting the above, TD Ameritrade Investment Management and TD Ameritrade shall not be responsible for any implementation error (timing, trading, etc.) relative to the Excluded Assets. 

The construction of your Personalized Portfolio(s) is based solely on the information provided by you to TD Ameritrade Investment Management and is assembled in consideration of the suitability and risk tolerance presented specific to this account or these accounts. A Personalized Portfolio is not intended to provide a complete financial plan. Assets held at other financial institutions, while used in the assessment of your overall investment and risk profile, are a snapshot in time and are not monitored, reviewed, or in any way evaluated in the ongoing management of the advisory accounts by TD Ameritrade Investment Management. You are responsible to contact your Financial Consultant if you have changes to your assets not managed by TD Ameritrade Investment Management or if there is a change to your financial circumstances that would necessitate the need for an updated assessment of your Personalized Portfolio.

Advisory services are provided by TD Ameritrade Investment Management, LLC (“TD Ameritrade Investment Management”), a registered investment advisor. Brokerage services provided by TD Ameritrade, Inc. TD Ameritrade Investment Management provides discretionary advisory services for a fee. Risks applicable to any portfolio are those associated with its underlying securities. For more information, please see the Disclosure Brochure (Form ADV Part 2A).

Morningstar Investment Management LLC is a registered investment adviser and subsidiary of Morningstar, Inc. Morningstar Investment Management LLC provides consulting services to TD Ameritrade Investment Management LLC (‘TD Ameritrade Investment Management’) by providing recommendations to TD Ameritrade Investment Management regarding asset allocation targets and selection of securities; however, TD Ameritrade Investment Management retains the discretion to accept, modify or reject Morningstar Investment Management LLC’s recommendations. Morningstar Investment Management LLC selects securities from the universe of investments made available through TD Ameritrade. In performing its services, Morningstar Investment Management LLC may engage the services of its affiliate, Morningstar Investment Services LLC, a registered investment adviser and subsidiary of Morningstar Investment Management LLC. Neither Morningstar Investment Management LLC nor Morningstar Investment Services is acting in the capacity of advisor to TD Ameritrade Investment Management’s clients. Asset Allocation target allocations are subject to change without notice. Morningstar Investment Management LLC establishes the allocations using its proprietary asset classifications. If alternative classification methods are used, the allocations may not meet the asset allocation targets. The Morningstar name and logo are registered marks of Morningstar, Inc. Morningstar Investment Management LLC is not affiliated with TD Ameritrade Investment Management or TD Ameritrade.










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