Why Hire a Financial Advisor?
A fiduciary financial advisor offers holistic financial planning and investment advice to help individuals achieve their financial goals. Distinguishing between fiduciary financial advisors and smooth-talking salespeople can be challenging. What sets a fiduciary financial advisor apart is their legal obligation to prioritize your best interests above all else. They are committed to acting in your best interest, ensuring trustworthiness, and placing your needs as a client first. Conversely, an advisor incentivized by commissions may over-promise and recommend products that benefit them more than you.
How to Know if You Need a Wealth Planner
Hiring an advisor is a big decision you should only make if it’s 100% right for you. The first step is understanding if YOU fit the description of someone who needs a financial advisor. Some scenarios include starting a business, planning for retirement, or family planning.
This is the most common scenario when people need financial advisors. Your golden years are when all your hard work will pay off. Transitioning from living off a salary to living off your retirement income happens only once, so securing your retirement is the best idea. It pays to have a good financial advisor in your corner. An advisor can answer questions like:
- When should I fully retire?
- Do I have enough saved up to live out the retirement I want?
- What is my portfolio’s appropriate mix of bonds, stocks, and cash?
- When should I withdraw from my IRA, and when should I start collecting Social Security?
- Which investments should I withdraw from, considering market conditions and tax implications?
Investing on your own is a big deal, especially if you are overwhelmed whenever the market decides to act up. During market uncertainty, investors develop a cloudy vision alongside flashing “sell” or “buy the dip” signs. A financial advisor will help you understand why the market acts up, how market volatility impacts your investments, and how to act.
Losing a spouse through divorce or death can significantly change your finances. Questions regarding property settlements, income adjustments after a divorce, or wills after death may arise. Guidance from a qualified fiduciary financial advisor specializing in these circumstances can be helpful.
Receiving a large sum of money can create anxiety about how to manage it properly. Whether it’s a business exit, inheritance, personal injury settlements, lottery winnings, or life insurance proceeds, they all involve big decisions that require proper planning.
If you receive employee stock options as part of your compensation package, it’s important to understand how to maximize their value in your life. A financial advisor with experience in employee stock options can help you learn what they are, how much they are worth, and how much they could be worth in the future.
Getting married or starting a family are big life decisions – and as we all know, children are not free. Deciding to grow your family can impact your finances, needing to consider child expenses, education, estate planning, etc. Some questions that an advisor can help you answer are:
- How will the budget be handled?
- How do I align my financial goals and make the appropriate changes to beneficiaries in retirement accounts?
- When and how do I start planning & saving for my kids’ college?
- How do I set up life and disability insurance, write or adjust my will, or adjust my budget now that I have a newborn?
A promotion, a job change, a partner deciding to stay home to be with the children, unemployment—all these career changes come with new pending financial decisions. These include possible budget adjustments, retirement savings, college planning, and health benefits. If you’re losing sleep over any of these financial decisions, the time is right to speak with an advisor.
Parents with children with special needs often have to plan further into the future. Considering different government benefits and creating the proper special needs trust after the parents’ deaths can be a priority.
Disclosure: This page is not investment advice and should not be relied on for such advice or as a substitute for consultation with professional accounting, tax, legal or financial advisors. The observations of industry trends should not be read as recommendations for stocks or sectors.