Having a firm grasp of your finances is a critical part of reaching your financial goals. With money being a very personal matter for each of us, knowing when you might need help can be a real struggle. Even so, changing circumstances and life events could be an early indication that you may benefit from a financial professional’s assistance. Indeed, here are ten signs that now may be an opportune time to speak with a trusted financial advisor:
1. You’ve just come into a large sum of money.
Have you become suddenly wealthy or come into a small windfall? Whether by inheritance, legal settlement, bonus, or other means, a key concern after the money comes in is, “what should I do now?” Knowing what to do with a large sum of money can be a challenge for many people. Undoubtedly, friends, family, and a host of other souls may offer you well-meaning advice. But the real question is: what do you want to do with your money?
More money can bring more opportunities. When you work with a financial advisor, they can help you narrow down and prioritize what you’d like to do with your money. They can also create a plan to align your spending and investing decisions with what matters most to you now that you have more opportunities. Doing so can help preserve the longevity of your money or ensure that you’re not spending in a way that you may otherwise regret.
2. You once enjoyed staying on top of the markets and your investments but would rather spend your time pursuing other interests.
Has investing lost its excitement to you? Losing interest in managing your investments can happen for many reasons. Maybe you were the type of person that got excited about tuning in to CNBC or daily reading the Wall Street Journal—even running the latest Zacks screens to find undervalued securities to add to your investment portfolio. Today, however, you would rather spend your time doing other things that interest you.
What about the financial goals set when you had initially opened that brokerage account? They may nevertheless be within reach. And did you know that a financial advisor can help manage the very account that you once managed on your own? Indeed, one job of a financial advisor is to stay on top of developments in the markets and economy and determine whether and what actions they need to take in their clients’ portfolios so that you don’t have to.
3. You’re not sure what to do about the investments you have overlooked for far too long.
Do you have three or four retirement savings account sitting with a former employer? When’s the last time you rebalanced your 401(k) or checked your brokerage account performance? If you’re not sure how to answer any of these questions, it may be a good time to check in with a financial advisor.
A financial advisor can help you make a plan to consolidate your investments, determine when and how often to rebalance your investment accounts, and show you where and why your investment performance may have deviated from the market. Simply put, a financial advisor will help your investments get back on track and help you keep an eye on its performance.
4. You’ve decided to retire and need help to manage your savings to ensure it lasts through retirement.
After planning for retirement, what’s the next most important financial decision you’ll make? Deciding on how and when to draw down your retirement savings. This decision is vital because your withdrawal choices during times of market volatility can have a significant effect on your savings’ ability to provide during your golden years.
For example, a withdrawal strategy that generally assumes calm markets can derail even the best-laid retirement plans when your investments significantly fall in value. A financial advisor can work with you to understand your liquidity needs and tailor a withdrawal strategy that produces an adequate amount of cash to weather a market downturn while keeping your money invested for the long term.
5. You have reached a meaningful life or career milestone and financial need a plan chart your next course.
Did you just get married (or divorced), buy a house, or get a promotion? It may now be an excellent time to speak with a financial advisor. The reason being is that your spending and savings patterns are likely to be affected by various crosswinds during this time of change.
More importantly, individual and family goals can shift as a result of these milestone events. A financial advisor can take the time to help you refine your priorities, create a financial plan, and provide tools that can help you align your spending and savings with your new financial priorities.
6. You’ve experienced career or personal change, and you’ve had to put off taking care of important financial decisions.
Has life come at you so fast that you’ve lost track of important financial goals? Whether you now realize that you haven’t saved enough for retirement or you have a child preparing for college, it’s never too late to save for retirement or any other consequential financial goal that you may have.
Financial advisors typically have access to sophisticated planning tools. And when applied appropriately, an advisor can create financial projections based on many model assumptions and inputs to show you with varying degrees the time and cost it may take to get your savings goals back on track.
7. Your financial goals are not as straightforward as they used to be, and you need some help realigning priorities.
Do you know what your financial priorities are? Understanding your financial priorities and objectives is essential because they are fundamental components of a solid financial plan. In fact, without clearly defining your goals, your financial plan is likely not to be as effective as it otherwise could be. So how can you clarify goals that once seemed straightforward? Talk it out.
The hallmark of a trustworthy financial advisor is in their ability to understand who you are as a person, listen to what you want from your life and help guide you toward a more specific vision of your financial intentions. What’s important to keep in mind during this process, however, is that your priorities match your values, or what’s important to you. The reason being is that if you can’t buy into the financial priorities outlined by your advisor, chances are you won’t buy into your financial plan.
8. You’ve tried the one-size-fits-all books, seminars, or planning solutions and are looking for a plan custom-tailored to your unique lifestyle needs.
Have you ever met someone that taught themselves how to play the piano by ear? Or how about that neighbor that knows how to fix just about everything only by Google searching an article or watching a YouTube video? If this speaks to you, chances are you probably have your financial and investment house in order but are looking for a way to take your process to the next level.
If these scenarios do not speak to you, you’re likely inclined to want someone to help guide you along your planning and investing journey. In either case, a financial advisor can look at your unique background, experience with planning and investing, and create bespoke solutions to meet your financial needs, goals, and objectives.
9. You want a more comprehensive solution to your financial needs.
When was the last time you heard of an electrical or roofing company take on the task of single-handedly building a house? It’s not likely as specialist contractors generally tend to stay in their swim lanes of expertise. That’s where a general contractor comes in. They broadly oversee the construction of a home, from the foundation up to the roof and everything in between, calling in specialists as needed.
When it comes to your financial life, one sign that you need a financial advisor is that you’ve worked with a specialist (an insurance- or investment-oriented advisor) and now want someone to help you out across all aspects of your financial life. As with a general contractor, a fee-only financial advisor offering comprehensive financial planning and investment management services will consider your financial priorities, create a plan, call in the specialists and walk you through each step of the implementation process.
10. You want objectivity in the financial advice you receive and not sure that a commission-based advisor can deliver that outcome.
Did you know that not all financial advisors receive compensation the same way? For example, a commission-based advisor typically earns an income when they sell you an insurance or investment product. Therefore, the more products an advisor can sell, the more revenue they make. When you pay a fee-only advisor directly for service, you receive advice that is in your best interest, free of any competing considerations for selling a product or moving your investments over to their firm. When this happens, it could increase your confidence in the motivation driving the advice you receive and turns the focus toward developing a long-term relationship.
What’s more, when you pay a fixed fee, whether upfront or ongoing, it is clear how much you are paying. A fee-only advisor typically has no complicated fee structures to explain or potential “hidden” fees that may lead to confusion. Through this approach, the benefit to you may be greater trust in your advisor. At the same time, it may reframe financial planning services as another normal part of your financial life, rather than an excessive extra.
Are you ready to speak with a financial advisor?
You may have your reason for wanting to work with a financial advisor not included in this list. The reality is that individuals each have their personal reasons for seeking a financial professional’s services.
Whatever the case may be, if you’re considering your financial future and have experienced a significant change in your life, want more time for other pursuits or entirely not sure where to start, now may be time to speak with a financial advisor.