When Should You Consider Hiring a Financial Advisor?

As a financial advisor, it can be challenging to understand why a person would refuse to work with a financial advisor. I can take guesses. Is it the perceived cost of working with a financial advisor? Are they embarrassed about their financial situation? Do they think they don’t have enough money? Are they more of a “do it yourselfer?” Maybe people just don’t know when they should engage a financial advisor. Here are some life events that come up where it makes sense to work with a financial advisor:

You Just Got Married

Congrats, you just threw one hell of a party and now you get to spend the rest of your life with someone. Marriage is the time in a couple’s relationship were finances become a centerpiece of the relationship. Over time, I’ve noticed that most couples rarely have financial discussions and often have very different views or goals of their finances. As a result, it’s not a surprise that finances (or lack thereof) play a significant role as a cause for divorce. If you’d like to avoid working with a divorce lawyer (or the guys from Wedding Crashers), sitting down with a financial professional can help a married couple communicate, set goals and fulfill a financial plan. 

You Had a Baby

Getting married is a big life change, but having a child is a momentous life change. You now have a person that is totally dependent on you. With a child comes a whole new host of financial challenges. You’ll have to figure out how to help them pay for college. Your budget will need to be reconfigured to pay for new expenses like diapers and children’s activities.  You’ll have to become a real adult and get life insurance and a will. 

Your Kids Graduated College

The kids finally graduated and it’s time to focus on Mom and Dad. Hopefully, at this point, your kids will be self-sufficient soon. These next 10 years are so are critical for a person to set themselves up for a proper retirement. They represent the last mile of a marathon race towards retirement and how you finish that mile will determine what type of retirement you’ll have. Typically, these will be the highest income earning years and the greatest opportunity to save money towards retirement. A good financial advisor will help you determine how you’d like to spend your retirement, devise a strategy to spend down your assets, game plan for future medical expenses and plan for your estate.

You Got Divorced

Unfortunately, divorces are very common, but they can often mean a person gets a new lease on life. Usually, most couples will have one person that handles a majority of the financial decisions. A divorce will disrupt that dynamic and forces a division of the couple’s assets. Working with a financial advisor can help a divorced person sift through their new financial situation and come up with a financial strategy for the newest life stage.

These are just four examples, but working with a financial advisor can have an impact beyond just looking at how someone’s money is invested. A good financial advisor will assist you in determining what financial freedom looks like for you, improve financial communication with your spouse, making sure you and your family are protected and maximizing your financial potential.