Do You Need to Talk to a Financial Advisor?

by Miranda Marquit · 2 comments

financial advisor
You can probably can do better financially by managing your investment portfolio themselves, but you might end up unsure of what to do with your money every once in a while. When it comes to figuring out your next step, talking to a professional can help can go a long way, especially when you have big decisions to make about your finances.

If you aren’t sure what to do next, a financial advisor can help you map out a plan. Here are a few times when it can make sense to meet with a financial advisor for a little extra help:

1. You’re Going Through a Major Life Change

Pretty much anytime you are making a major change in your life, it can make sense to meet with a financial advisor. Some of the major events likely to prompt financial changes in your life include:

  • Marriage
  • Divorce
  • Starting a family
  • Retirement
  • Making a big move

These large life changes impact the way you use money and can change your financial situation dramatically. If you see these items looming on your horizon, consider talking to a financial professional about your path. You might find it easier to navigate with an outside perspective.

2. You Receive a Windfall

One of the best things to do when you receive an unexpectedly large amount of money is to do nothing. Wait to make decisions about the money. Let it wait. And while you’re waiting, consider consulting with a financial advisor. The right financial professional can help you walk through your windfall, explore the options, and decide what your next move should be. Don’t make a decision about the money immediately, especially if you are excited. Decisions made in a heightened emotional state are rarely the best choices.

3. You Don’t Have Any Estate Planning

While you might not go to a financial planner for estate planning, you do want to see a professional. From making sure you have a will, to considering the advantages of a trust, it makes sense to see a professional about how to best to preserve your legacy and protect your family. If you have a financial advisor you trust, ask for a referral to someone who can take your planning to the next level and help you work out the best way to ensure that your family is protected.

4. You Reach a Certain Net Worth

One of the realities of life is that most wealthy people don’t actually manage their own money. They hire people to do it. While you might not be quite to the point that you want someone else to manage your money, it makes sense to touch base with a financial advisor once you reach a net worth of $250,000 or so. At this point, a good financial advisor may be able to help you save more on taxes that can more than pay for their fees, and also help you efficiently grow your resources.

Pay attention to where you stand. Think about how you might be able to benefit from a financial advisor’s help. Even if all you do is go in to see how you can reach a specific goal, you can benefit.

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  • freebird says:

    I think my colleagues at work who have reached seven figures net worth mostly still self-manage. I’ve been able to find pretty much all the expertise I need online from various bloggers and forum discussions. It takes a bit more time and legwork than just listening to one advisor you hire, but knowing what options are out there and their pros and cons described by people who have been there done that I think gives a more complete picture that helps me decide.

    If you go this route and hire a financial advisor, be sure to find out how they get paid. This might affect the kind of advice you get, especially if you’re really talking to a salesman.

    • David Ning says:

      Good advice. You are onto something when you decided to manage your investments by yourself. After all, it’s extremely difficult for the advisor to add so much value that they can make up the fees they charge every single year.

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