I get really nervous when driving in strange places. The anxiety comes from my poor sense of direction – I could get lost in a phone booth. My wife, on the other hand, makes a fine navigator. She could be trapped in an underground cave and still tell which way is north.

We didn’t plan on renting a car during our trip to Scotland and Ireland last summer. We thought we’d mostly get around by walking and taking public transit. That worked out well in a big city like Edinburgh, but after a few days in the Scottish Highlands it was clear that a car would give us more freedom to explore our surroundings.

It’s fair to say I was scared out of my mind, not only to navigate through a foreign land but also to drive for the first time on the opposite side of the road. Still, the prospect of discovering new sights and experiences was too great to pass up, so I steeled my nerves and hired a car from the Inverness airport. 

I gripped the wheel tightly, and with my wife deftly guiding us through roundabouts, across narrow roads, and underneath breathtaking viaducts, we discovered new castles, stone circles, and famous battlefields throughout the Scottish Highlands. It was a road trip to remember. 

Brimming with confidence, and a newfound sense of freedom, we thought nothing of hiring a car again in Ireland and driving across the country for two-days of sightseeing. 

If I were travelling solo, given my lack of navigational skills, I would’ve been forced to use technology to guide me through the journey. But GPS isn’t always fool-proof. Ask the countless number of drivers who’ve followed their car’s GPS directions only to end up in a lake.

Sure, my wife also used Google Maps to help guide us to our destinations. But instead of blindly following the voice commands (like I would do), she would use the satellite view and her keen sense of direction to keep us on course.

Having an expert navigator along for the ride gave me the confidence to do something I never thought I’d be able to do. I’ll be honest, driving in Scotland and Ireland was nerve-racking at times. But it was also a lot of fun, and I’m grateful for the experiences we had thanks to getting out of our comfort zone.

It’s because of those experiences that we had no qualms about renting a car in Italy when we visit in April. We’re picking up a car in Florence and driving to a little hilltop town in Tuscany to stay for a week. Like the Scottish Highlands, we think a car is a must so we can explore all the medieval towns and villages in the region. Unlike in Scotland, we can drive on the right side of the road in Italy.

How Does This Apply To My Finances?

Some people are blessed with a strong sense of direction (like my wife). Others, like me, need help from technology and/or a trusty navigator to guide them to their destination.

When it comes to personal finance and investing, some people have a knack for it, while others need a helping hand.

Related: Your financial plan is a compass

Those with a strong financial compass understand exactly where their money goes, know how much to save, and have enough knowledge to invest on their own.

Unfortunately, some people either have no desire to learn about personal finance, or simply cannot comprehend how to make their money work for them. Like the poor traveller who’d get lost in a phone booth (me again!), those lacking in financial acumen likely need a trusted guide to help them reach their retirement destination, and navigate through all of life’s financial milestones along the way.

Most people, however, seem to fall somewhere in between. They know enough to nail the basics:

  1. Spend less than you earn
  2. Save a percentage of every paycheque
  3. Prioritize your financial goals
  4. Invest for the future

One solution for these in-betweeners is to pair technology – in this case a robo-advisor, with a navigator – in this case an unbiased fee-only financial planner

The robo-advisor acts as the GPS, automatically monitoring and even rebalancing your investments to ensure you meet your retirement goals. Robo-advisors aren’t perfect, so while they may not steer you into a lake, most charge a fee in the 0.50% range to take the wheel and manage your investments.

Alternatively, those with a little more confidence in their investing prowess can save money by opening a discount brokerage account and purchasing a single ETF (an asset allocation ETF). With this approach, investors can build a low cost, globally diversified, and mostly hands-off investment portfolio.

So that’s how to manage your investments, leveraging technology to save on fees and build a diversified portfolio. But your investments are really just a small part of your financial plan.

A Financial Navigator

The bigger picture means asking yourself questions like, what are my financial goals for the short and long term? When should I retire? When can I afford to retire? How much do I want to spend in retirement to allow me to live comfortably? Should I take CPP at 60, or wait until 65 or even 70? Do I want to sell my house at some point and downsize, or even rent in retirement?

For answers to these questions you might find comfort talking to an unbiased financial planner. Someone who charges you by the hour or by the project, not based on how much you invest with them.

This type of accountability relationship is a lot like having a trusted navigator by your side. Someone to point you to a potential shortcut, or to avoid the road construction ahead. Perhaps someone to point out when you’re about to turn into a lake.

Are you blessed with a clear sense of direction when it comes to your finances? Or do you need a financial navigator to help guide the way? 

Print Friendly, PDF & Email

9 Comments

  1. Maria @ Handful of Thoughts on January 29, 2020 at 11:24 am

    My husband sounds a lot like your wife Robb. He is a great navigator, I’m getting better every time we travel and rent a car ha ha.

    Right now on our path to financial independence we use the assistance of a financial navigator from time to time. Although I think this may change as our life circumstances change. We have a good idea understand of the stage we are at now but will need help when we transition to the next phase.

    • Robb Engen on January 30, 2020 at 8:21 am

      Hi Maria, I think that’s a great option to get advice periodically throughout your life as your situation or goals change. It’s always a good idea to have a sober second opinion on your plan and to make sure you’re staying the course.

  2. Christie on January 29, 2020 at 11:41 am

    Steel your nerves for driving in Italy. It’s a whole new level of crazy!

    • Robb Engen on January 30, 2020 at 8:26 am

      Ha! I’ve heard mixed reviews on this. We’re staying in Rome and Florence (3 days each) and won’t have a car, but our plan is to rent one at the Florence airport and drive to Cortona (we’re staying just outside of the town so we’ll need a vehicle). We’ll keep the car a week to explore Tuscany and then drop it off at Camucia. From there we’ll take the train back to Florence and then on to Venice for three days.

      The one nice thing about driving in Scotland and Ireland is that there were barely any cars on the road. So you’d alternate between blissful driving on open rural roads and white-knuckling as a large truck or tractor passes by.

  3. DaveG on January 29, 2020 at 1:10 pm

    Taxi from the airport to downtown Florence and we very quickly decided we weren’t going to rent a car!

    • Robb Engen on January 30, 2020 at 8:28 am

      I hear you, Dave. We felt the same way in Edinburgh and Dublin – nope!

      We don’t need a car in Florence but plan to pick one up at the airport and drive to our hilltop town. Hopefully the airport area is not too hectic!

  4. Kathryn on January 29, 2020 at 6:54 pm

    Excellent advice! I wish I’d educated myself years earlier, but at least living within my means and saving the rest has put me in a good position. I’m happy to see this type of navigational advice available for people who can take advantage earlier, and do even better than I did. Online brokerage, low fee products, fee-only financial planning, and research/education…the four pillars of a successful financial plan. Thanks for your contribution to my financial education!

    • Robb Engen on January 30, 2020 at 8:30 am

      Thanks so much, Kathryn! There are so many mare options for people to help themselves, save on fees, and plan for the future. I’m glad to have played a small role in educating consumers on financial literacy.

  5. Gary on February 2, 2020 at 5:15 pm

    I managed my own portfolio for forty years but now that I am starting to RRIF I am using an advisor who is managing our accounts and all the paperwork

Leave a Comment