The importance of diversification is a well-discussed topic in investing. However, it’s not just about investing in various industries or investment types. It’s also about diversifying where you get your investing information.
Many families and individuals use a financial advisor to offer advice related to budgeting, long-term goals, tax preparation, risk tolerance, insurance, and investment strategies. Financial Advisors can be a great way to look at your overall financial health and retirement planning. However, their advice is limited. It’s crucial to rely on something other than financial advisors as the sole source of investment advice.
Here are a few reasons why financial advisors won’t tell you about mortgage investing:
Financial advisors and planners will be aware of real estate as an investment vehicle, and many will suggest owning your own home or even rental income through owning various properties. What many financial advisors will not tell you about are REITs or private mortgage investment pools. There are many reasons they wouldn’t mention these funds, including a lack of awareness.
Many financial advisors may not be fully aware of the potential benefits of mortgage investing as an alternative asset class. This could be due to a lack of education or experience in this area or simply because mortgage investments aren’t typically offered through traditional channels. As a result, investors who rely solely on their financial advisors may be missing out on the potential for diversification and passive income that mortgage investing can offer.
Some financial advisors may be uncomfortable recommending investment options outside their usual offerings. They may be more familiar with traditional investment methods such as stocks, bonds, and mutual funds. They may need to gain experience or knowledge of other types of alternative investments, such as mortgage investing, art collecting, or even currency trading. This could mean that investors aren’t getting a complete picture of their investment options and missing out on opportunities for diversification.
Investors may need better advice or recommendations than a financial advisor can give. As mentioned earlier, financial advisors are often paid based on commissions from the sale of investment or insurance products. There may be a conflict of interest if the advisor recommends certain products simply because they offer the highest commissions. In many cases, financial advisors are provided with in-house products, which limits their ability to work outside of the commission structure that benefits them.
We believe in the importance of diversification in investing. By spreading your investments across different asset classes, you can reduce your overall risk and potentially increase your returns. Mortgage investing can be an attractive option for investors looking to diversify their portfolios, as it offers the potential for steady, passive income and can be less volatile than the stock market. Additionally, many large-scale mortgage investment corporations (MIC) like Cooper Pacific don’t charge investors fees as financial advisors do, making it an even more attractive option.
While financial advisors can be a valuable resource for individuals seeking money management advice, it’s important not to rely solely on them for investment advice. By exploring alternative asset classes like mortgage investing, investors can diversify their portfolios and potentially generate passive income without relying exclusively on traditional investment products. To learn more, get in touch with Jordan on our team today.
Please enter your email, and we will get back to you right away.
We value your privacy and will never send irrelevant information