There are times you don’t need the help of a financial advisor to achieve some financial goals. For instance, some thing as simple as saving money to buy a house can be done on your own. However, there are some turning points in your life when consulting with a financial advisor may be helpful.
For example, you might be thinking about starting a family soon. You might be thinking about retiring early. Or your finance might just be a mess and needs some direction. If any of these situations below apply to you, then you may need to work with a financial advisor.
Find out now: How to Find an Advisor in Your Area.
Before we delve more into the topic, what is a financial advisor? In other words, what does a financial do?
A financial advisor (sometimes known as financial planner) is a licensed professional authorized to help you make major financial decisions in order to reach your financial goals. They help you with all types of financial planning like budgeting, retirement planning, investing, tax planning, etc. The advice can be a simple, focus on one aspect of your finance (for example, the best way to save for retirement). Or it can be general advice, involving a comprehensive plan to help you set financial goals.
If you’re looking for a financial advisor in your area click here.
1. You’re planning for retirement.
Perhaps the best time you need to consider hiring a financial advisor is when you’re approaching or planning for retirement. It is so because a bear market could come just as soon as you retire leading you to lose most if not all of your money. Your investment portfolio may not be well balanced.
A professional can help you balance your investment portfolio, making it more conservative. That means allocating money to different stocks, bonds, mutual funds, etc. That way you don’t to stand to lose all of your money in a bear market.
Another reason why you need the help of a financial advisor is that you may outlive your money. The average life expectancy is around 90 to 95 years. So there is a chance you might live to 30 years after you retire at 65. A financial advisor can come up with a plan to help you generate extra income to prolong the life of your retirement portfolio.
Related: 5 Reasons Why You Will Retire Broke.
2. You’re ready to invest.
Investing can be intimidating for most people. A financial advisor can help you with developing an investment plan. While sometimes you don’t need one to invest, but if you’re a beginner and don’t know what you’re doing, it makes sense to have someone with more expertise in the area.
A financial advisor can help you identify short term and long term investment goals that you alone may not have thought about. A short-term investment goal can simply be paying off your credit card bills to free up some money.
3. You’re starting a family.
Another sign that you need a financial advisor is when you’re planning for a major life event like starting a family. While exciting, starting a family can be very expensive. You have to think about childcare, housing expenses, medical expenses, mortgages. Moreover, if you something were to happen to you, you would want to make sure that your spouse and/or your children are financially protected. That means you have to make sure you have a health insurance and life insurance.
So if you’re planning to start a family, now is the time to sit down with a financial advisor to discuss the right insurance polices that is right for you; to discuss savings/trust funds for your children’s education, and so on.
4. You have a lot of Debt.
You can probably handle having a few thousands dollars in credit card debt or other forms of bad debt. But if you’re dealing with hundreds of thousands or millions in debt, get advice from professionals who have helped others in similar situations.
A financial advisor can help you make a budget and set up a repayment plan to pay off your debt. They can help you find extra money in your budget that can go towards your debts. So, if you’re having trouble paying your bills or need to sort out your debts, you might need to seek professional advice.
5. You’re building a business.
Investment or retirement advice is not the only thing financial advisors are equipped to do. Many are also capable to give you advice on your business needs. If you’re just starting a new business, an advisor can offer you financial advice on how to structure your business, the type of business to form, etc…
So consult with a financial advisor now so you can reach your financial goals.
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2. Second, If you’re thinking of buying a house, estimate how much you may be able to borrow. Get pre-qualified.
3. Open a high yield savings account. Having an online, high yield savings account allows you to save money and earn over 15 times the national average in interest. Check out CIT Bank online savings account, which has a 2.45% APY. Learn more.