But if you are considering your wealth management and retirement planning journey, and are having reservations about hiring a professional to help you plan and manage your money, is this a sensible approach? What is involved in DIY expat financial planning, and is it going to fit in with your expat lifestyle in Lisbon?
Are you cut out for DIY wealth management?
When it comes to financial planning, a ‘do-it-yourself’ approach brings with it a great many ongoing responsibilities. To fulfill the required tasks you will need to ensure that you not only have the necessary knowledge, expertise and practical skills but also the time, organisation and emotional resilience which are integral to the investment process.
There are five key criteria essential to DIY financial planning*:
- You should love the investment process and be so passionate about investing strategies that financial pursuits already take up a large part of your leisure time. If your bedside reading consists of books on economic theory, if you enjoy an extended breakfast with the Financial Times, and you consider attending an investing seminar to be a relaxing break, you might just be suited to managing your own wealth.
- Another important qualifier for the DIY expat financial planner is the ability to comfortably make decisions about your financial future. This means that you must not feel overwhelmed by the process and the high stakes, and that this responsibility does not cause you to lose sleep at night.
- You will need to be time-rich and prefer to spend time reviewing your portfolios rather than playing golf at Estoril Palácio or hanging out with grandchildren. It sounds harsh, but it’s true. Good investment decisions require research, planning and accuracy.
- You will need to be able to withstand market volatility without making rash decisions. Investment portfolios inevitably lose and gain value during times of economic instability and you must be able to withstand ups and downs in the value of your assets and investments without making knee jerk trades or heat-chasing purchases.
- Can you keep your eyes on the long-game? It is easy for the self-investor to dip into their savings accounts, pensions and other assets without fully appreciating how this might affect future returns. Budgeting and time-horizon planning are key in this respect.
Only if the above describes you to a tee would you be a likely candidate for DIY financial planning.
Robo-advisers – Are they a good compromise?
Robo-advisers might seem like the perfect halfway point between DIY investment and working with a human financial adviser. However, in reality most investment platforms are little more than glorified algorithms that take some account of your risk tolerance and goals, following a short questionnaire, before grafting your funds into a pre-constructed portfolio.
They are not personalised, cannot talk to you, cannot listen to you, and cannot help you stay disciplined during times of volatility. In contrast, a professional financial adviser will develop a relationship with you and will integrate your finances, tax considerations and estate plans while also taking account of all the unique cross-border concerns that go hand-in-hand with being an expat living in Lisbon.
Lastly, a robo-adviser cannot know – or care – if you are having health issues, have a grandchild with special educational needs or are wondering about the financial implications of a divorce; a human adviser can make an invaluable difference at the times when you need expert, bespoke advice the most.
Tried and tested expertise to advance your interests
Blacktower Financial Management has more than three decades of experience advancing the financial interests of our clients. We can help you weather the financial uncertainties and ramifications of challenging times – such as Brexit – so that you can be secure in the knowledge that your money will continue to work for you.
We believe that attempting to negotiate Brexit is likely to present too many challenges for the expat in Lisbon – both emotionally and practically – for DIY money management to be a prudent option. The expat financial advice sector remains integral to helping British people abroad reach their retirement investment goals, particularly in Lisbon, where a climate of innovation and opportunity has created real excitement and momentum.
For more information about our services and expertise, speak with our expat financial advice team in Lisbon today.
* According to Investopedia: https://www.investopedia.com/articles/personal-finance/060415/financial-planning-can-you-do-it-yourself.asp Accessed 30-09-19
For more information contact Blacktower on: 289 355 685, email: firstname.lastname@example.org or visit: www.theblacktowergroup.com or https://www.blacktowerfm.com/locations/portugal-algarve
This communication is not intended to constitute, and should not be construed as, investment advice, investment recommendations or investment research. You should seek advice form a professional adviser before embarking on any financial planning activity.