Taking care of your finances is your responsibility, but you don’t have to do it alone. An advisor, or better yet, a certified financial planner, comes in useful anytime, especially when changes in life create new financial obligations and challenges.
Below is a list of events in one’s life that make seeking professional advice a prudent course of action.
1. You have a major life transition. Marriage, divorce, a birth or a death in the family – these are some of the biggest reasons to use a financial advisor.
- If you’re about to get married, an advisor helps you and your spouse-to-be navigate the uncharted waters of merging finances and decide what to combine and what to keep separate. An advisor acts as an objective third party, offering guidance when the two of you disagree.
- If you’re going through a divorce, an advisor helps you make new plan to reach your individual goals and, during the negotiation of the divorce itself, assists attorneys in understanding the asset and income value.
- If you have a baby on the way, an advisor makes cash flow planning for the additional expenses a child brings and for long-term goals such as college funds.
- If one of your family members passes away, an advisor helps with retitling and distributing assets and, in complex situations, works with estate attorneys and accountants to handle various aspects of settling the estate.
2. You are nearing retirement. A large percentage of our clients come to us in their 50s or early 60s, as retirement starts to feel like it’s just around the corner. An advisor helps you figure out when you can retire and how to allocate your investments, including how aggressive or conservative you should be.
He or she can also help you find out when to start collecting Social Security to optimize your benefits, how much you can safely spend after retirement and how to withdraw money from your retirement accounts in the most tax-efficient way.
3. You receive a windfall, such as an inheritance, a legal settlement or a lottery win (we all like to dream). Seeking objective advice is a smart move. People often make mistakes, which they later regret, when unexpected sums of money drop into their laps. An advisor helps you invest and withdraw the funds appropriately, assuming you want them to last for some times or throughout your entire lifetime.
4. You get new job benefits. If your compensation becomes more complicated than a salary – for example, stock options or a deferred compensation plan – an advisor helps you make decisions that work best with your overall financial plan and investment strategy.
5. You own a business. An advisor counsels you on keeping personal finances separate from your business affairs, setting up retirement accounts that fit your needs and planning for an exit - sale or transition of your business - when you are ready to retire.
6. Anytime. You probably saw this one coming, but in all honesty, anytime is a great time to reach out to a financial advisor. Whenever you have questions about your financial life, want someone to manage your investment portfolio or just want a second opinion, a planner is your most useful resource.
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Jordan Mills is a senior associate consultant at Wipfli Hewins Financial in Minneapolis.
Hewins Financial Advisors, LLC and Wipfli Hewins Investment Advisors, LLC (together referred to as “Hewins”) are independent, fee-only investment advisers registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940. The views expressed by the author are the author’s alone and do not necessarily represent the views of Hewins or its affiliates. The information contained in any third-party resource cited herein, including but not limited to other blogs, websites or articles, is not owned or controlled by Hewins, and Hewins does not guarantee the accuracy or reliability of any information that may be found in such resources. Links to any third-party resource are provided as a courtesy for reference only and are not intended to be, and do not act as, an endorsement by Hewins of any of the content found therein or its use. The standard information provided in this article is for general educational purposes only and should not be construed as, or used as a substitute for, financial, investment, legal or other professional advice. If you have questions regarding your specific situation or any of the information contained herein you should consult your financial and/or legal professional. Hewins is a proud affiliate of Wipfli LLP. A copy of Hewins’ current ADV Part 2A brochure discussing Hewins’ investment advisory and financial planning services and fees is available for review upon request or at www.adviserinfo.sec.gov.
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