Should I Use a Financial Advisor or Do It Myself?

Knowing how to manage your finances is a skill everyone should have. And while you may undoubtedly handle the ins and outs of personal finance on your own, there are times when working with a financial advisor may be more beneficial.

What Is a Financial Advisor?

A financial advisor is a professional who helps clients manage their finances. In most cases, financial advisors oversee and maintain your investment portfolios by directing your savings into worthwhile assets. Some financial advisors, particularly those who are also financial planners, may help their clients with other areas of their financial health as well, such as budgeting, saving, and planning for short-term and financial goals.

In simple terms, financial advisors help you build your wealth. They often bring decades of experience and knowledge to the table, which enables them to offer a valuable perspective.

When to Consider Working with a Financial Advisor

Working with a financial advisor may be worthwhile if you’ve undergone a significant life transition. Here are some cases where you should consider hiring a financial advisor rather than attempting to go it alone.

#1 Just Married

Financial compatibility is an indicator of a solid, healthy marriage. If you have plans to get married or have recently tied the knot, it’s a good idea to sit down with a qualified financial advisor. Like a marriage counselor, a financial advisor can act as a third party who brings a professional perspective to help couples navigate this specific part of their relationship. For various reasons, many couples bring incongruous, preconceived notions about money into their marriages. It usually stems from being raised in households that handle finances differently—whether that means coming from a home of scarcity or abundance.

There’s no reason to be nervous about finding out you’re financially incompatible with your partner. Instead, this is an opportunity for you and your spouse to work together to prepare for your future.

A study at Kansas State University found that new couples who frequently argue about money are around 2.5 times more likely to be less satisfied later in their marriage. Creating a plan together could help you avoid that.

#2 You’ve Recently Adopted or Had a Child

Having children changes everything about your household finances, from your daily expenses to your long-term goals, and financial planning in a household with children can often be stressful. A financial advisor can help you take stock of your current income and expenses and develop a strategy for budgeting for future goals like paying for your child’s education and hobbies.

#3 You’ve Become a Caretaker

Taking on the role of a caretaker for someone else is financially challenging. If you’ve recently become responsible for an aging parent, you may face expenses like medical care, housing, and increased grocery prices. A financial advisor can help you plan for these expenses while keeping you on track with your financial goals. As a caretaker, the person you care for may be eligible for Medicaid or financial assistance.

#4 Your Income Changed

It’s also wise to work with a financial advisor anytime you experience a major change in income, as a significant pay cut or increase affects how you budget, save, and spend.

#5 You’re Starting or Selling a Business

When starting your own business, you gamble with different risks. A financial advisor can help you balance things out by determining strategies for becoming more fiscally conservative during this transition. Selling a business will most likely change your income, whether by increasing or decreasing it. A financial advisor can support you through this change by helping you prioritize your spending in a way that protects you. If your income increases, they can help you determine the best ways to manage and build your wealth.

#6 You’ve Inherited Money

Inheriting money can be bittersweet if you’re dealing with the loss of a loved one. A financial advisor can help you strategize how to manage the inherited money in the short term while you process your grief. They can also assist with long-term planning that helps you feel more confident that your obligations and assets are safe.

#7 Your Salary Increased

When your salary increases, you have the opportunity to unlock new financial goals. A financial advisor can offer guidance on how to invest or spend your increased income in a way that supports your financial goals.

Discover the Good Life

So, should you hire a financial advisor or do it yourself? We hope this blog helps answer that question for you. But if you’re still not sure if a financial professional is best for you, you may want to consider interviewing a few professionals in your community. If you are a Charleston, SC, resident, Good Life Financial Advisors of Mt. Pleasant is here to help.

As proud CFP® professionals affiliated with the Financial Planning Association, we’re happy to sit down and answer all your questions with a complimentary discovery call. This meeting is a no-obligation consultation where we will discuss your current life circumstances, financial situation, and long-term money goals. It is also an opportunity for you to learn more about us and determine whether you feel comfortable moving forward with our team of financial professionals.

If you’re ready to discover the Good Life, contact us today to schedule your free discovery call.

The opinions voiced are for general information only and are not intended to provide specific advice or recommendations for any individual.