Credit co-operatives are like the banks that you never knew existed.
As the saying goes “Don’t put all your eggs in one basket.” Diversification is a fundamental investing and risk management concept. Does this apply to financial planning and insurance as well?
Throughout our lives, we inevitably meet a lot of financial advisers, and there is always a question of whether to engage more advisers or stick with the one(s) you already have. This is especially true when we move from one life stage to next.
In this article, let’s explore the pros and cons of having just one financial adviser for your financial planning needs.
Pros Of Having Just One Financial Adviser
# 1 No Need To Repeat Yourself
Having just one financial adviser, especially if that person is great, is all you need. They understands all of your financial needs and advises you on suitable products. You do not need to keep repeating your entire financial situation and life goals to different financial advisers, which can be repetitive and tiring. Furthermore, if you have just one financial adviser, you just need to update one person n cases of changes in life stages, like job situation, financial situation, health concerns, etc.
Furthermore, if you have any private matters you do not wish to talk about often, it’s easier to have a single person to handle everything. The less people who know, the better.
# 2 No Redundancy
While being under-insured is a big problem, being over-insured is also an issue that is less discussed. Being over-insured poses a problem because you’re paying more than you should, limiting cash flow for other purposes like investments.
This happens commonly when you buy policies from multiple people, who are not aware of what existing policies you have. Typically, the policies you own sit in drawers, untouched for a while. This is worse when you get them for reasons other than personal, e.g., to “support” a friend or family who has gone into the financial planning industry.
By sticking to a single financial adviser, you avoid this possible redundancy.
# 3 Single Point Of Contact
Picture this: you bought a life insurance from A, health insurance from B, and a personal accident policy from C. After that, let’s say you get into trouble, like an accident, sickness, etc, you’d have to recall who can help you with your incident.
During a claims situation, it is ideal that a single person who has access to your entire insurance portfolio. The last thing you want to do when disaster strikes is needing to figure out who handles which policy.