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Is it Time for a Financial Advisor?

Is it Time for a Financial Advisor?

Today, we delve into a topic that for many Americans is source of anxiety: investment. Coming out of the Financial Crisis of 2008, financial advisors went from a savoy tool to help one make money to a dark, greedy villain out to take you for everything you have! But like most things, there’s facts and there’s alternative facts. Let’s separate these a bit, shall we?

First off, what is a financial advisor you may ask? It’s an educated professional who is paid to provide financial advice, services and financial planning strategies to clients based on their fiscal situation. Financial planning is the process of defining your goals and objectives and then developing a plan of action, or a detailed map, to help you meet those goals. A financial advisor provides the assistance you need to create projections, build a strategy and help you meet long-term financial objectives. Financial advisors may also go by other designations, such as Personal Financial Specialist, Registered Investment Advisor, Certified Financial Planner, etc. Everybody’s got their own take on it!

Regardless of official business card title, a good financial advisor can open your eyes to all of the opportunities you may be missing and help you make better monetary decisions. They will advise you on topics such as to how much you should be saving and where you should be putting your money, offering advice regarding different types of retirement accounts, how much and what type of insurance you should have, as well as investment opportunities and risks. They can also provide estate and tax planning advice as well. The fee(s) for financial advisors varies depending on the company, experience of the professional and the work they are doing for you. Some charge an hourly or flat fee for a specific project; others may charge a percentage of funds they are managing on your behalf or a commission. Really depends on what you’re looking for…

Speaking of, who’s looking out for your best interests?

Perhaps you’re currently managing your own money. More and more individuals are dipping their feet into the waters of money management, possibly spurred on by the excitement and glamour portrayed in films, such as The Wolf of Wall Street and others. But just remember, these are just movies and most don’t have such happily ever afters! If you’re going to manage your money successfully, you need to do it responsibly. After all, your future depends on it! What’s your level of knowledge regarding money management? How strongly versed are you in financial markets or investment products and services? It’s okay, be honest.

It’s time for a reality check. Remember Gordon Gekko’s quote in Wall Street, “the most valuable commodity I know of is information.” Well, ain’t that the truth! The more knowledge you have, the better you will be able to manage. If you don’t have the understanding first, you may not want to risk your hard-earned money on a do it yourself management plan. Making an error on your checking account and not having the extra $10 you thought you did for a quick lunch is one thing. Having to work an extra 5 years because you miscalculated your retirement is something totally different!

5 Reasons to Bring in a Pro:

  1. It’s never too early to start planning for retirement! Whether you’re nearing retirement age and have lots of questions about when to file for social security and the best strategy to make your retirement money last, OR the ink is not yet dry on your first real job, a financial advisor can help project what you’ll need and how close you are to achieving your goal. #goldenyears
  2. Your finances are complicated. You may be self-employed, dealing with an inheritance, just hit the Powerball or have a huge stock portfolio. Maybe you’re planning a big life change, such as marriage, a new house or baby. Whatever you’re dealing with, the finances that accompany it are likely no walk in the park! Professional advice may really benefit someone dealing with complex matters such as these. For as the old adage goes, jack of all trades, master of none. Don’t get caught up trying to do it all. Call an expert to advise you. It’s what they get paid to do!
  3. Congrats! You’re wealthy and you want to make sure you’re managing your money wisely. If you’re lucky enough to have a high net worth, you want to make sure you’re effectively managing your money for the best possible return on investment, getting the best tax breaks and with a strategy that will enable you to meet your long-term financial goals. With more wealth, come more options! You’ll want to make sure you’re well acquainted of all of those possibilities and potential benefits and risks of each. Once a plan is established, a financial advisor can also help keep your investment plan on track so you never have to worry about $$ again! The dream, amirite?!
  4. You just have no idea what to do or you just don’t want to deal with it. There’s no shame in admitting you’re not a complete expert at managing your finances. Hell, we don’t one person who is, and we work in finance! Asking for help is the smart, responsible thing to do for you and for your family. Maybe you haven’t taken any steps at all towards financial planning and aren’t sure where to start. A financial advisor can provide the strategy you need to get you on the right path. Perhaps it’s a focus on paying off debt, such as lingering student loans, purchasing your first home, establishing your retirement accounts or building an emergency fund. If you can relate to this, then hiring a financial advisor is the clear choice!
  5. You are in need of tax or estate planning? How will new tax laws impact your finances now and in the future? Don’t get caught off guard, remember what we touched upon earlier, information is a valuable commodity! Estate planning is also very important to your long-term goals. Do you have a family to take care of? What will happen to them if anything happens to you? No one wants to dwell on bad things, but it’s important to prepare now and ensure your family is well-taken care of after you’re gone. A financial advisor can help you get a plan in place that will save you from the stress of worrying or regret if anything bad does happen and you are not prepared. As Benjamin Franklin once said, “in this world nothing can be said to be certain, except death and taxes.”

Ready to hire a financial advisor? Here are some of the best questions to ask:

  • Educational background, experience, certifications.
  • How long have they been advising?
  • Are all services provided?
  • Detailed information on their investment philosophy.
  • Average size of the portfolios they work with.
  • How often you would meet with them to get updates, advice and evaluations.
  • Ask for details on their fee structure and compensation.
  • Ask for names of client references with contact information.

Hiring a financial advisor is an important decision and one you shouldn’t take lightly. This is a trusted partner that ideally will be with you for a long time, and you want someone you know is knowledgeable, trustworthy, and totally understanding of your needs and goals. The right financial advisor will provide you with the expertise and resources you need to better plan your healthy financial future. They will adjust that plan as circumstances change in your life and as your needs change, so you want to make sure you’re in good hands!

Choice One Community Credit Union offers those good hands in terms of financial advisory services through Members Financial Services.  A group of professionals with decades of experience, they can provide a detailed roadmap to take you where you want to go financially and will be there each and every step of the way! Interested? Stop by one of our three conveniently-located branches to schedule an appointment today!

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