How to Decide When You Need a Financial Advisor

Historical insight — Originally published February 9, 2023. Preserved as historical content; information may have changed.

Determining when to hire a financial advisor doesn’t have to be a stressful decision. Anyone can benefit from speaking with a financial advisor, and many of our clients say they wished they’d contacted us sooner.

For most Americans, it makes sense to consult a financial professional when life becomes complicated. While a good rule of thumb is to hire an advisor when you can save 20% of your annual income, there’s no hard and fast axiom for seeking financial advice.

Some of our clients approached us when their financial situation entered territory that was too complex for anonymous forums and DIY investing articles. Others needed tax guidance or were nearing (or thinking about) retirement. Several of our clients approached us when they were starting a new job or had benefited from a large inheritance. And another group of clients engaged us as they prepared for a new phase of life, such as starting a family, buying a home or getting married or divorced.

The reasons for searching out financial guidance are many. It’s important to keep in mind that the best financial advisors want to help—and there’s no situation too big (or too small) for their expertise. To demonstrate, we’ve outlined some common scenarios where clients have turned to us for financial advice.

Facing questions about saving, planning, and investing for retirement is one of the top reasons for engaging with a financial advisor. Building and funding a strategy for an event that could be decades away is difficult. But advisors will guide you through the decisions you will need to make and how they can affect your future financial picture.

For savers approaching their Golden Years, there are important deadlines for enrolling in benefits programs and purchasing products, like life insurance and long-term care coverage, to be aware of. Advisors center their planning around these dates, providing you with assistance in protecting your assets and verifying that you won’t run out of money in your retirement.

And retirement planning isn’t just for investors who are in their 50s or 60s. The best advisors discuss retirement plans with clients who are still squarely in their peak earning years. The decisions they make today will have an impact on their future, so advisors can adjust investments and timelines to keep clients’ retirement goals on track.

Purchasing real estate is one of the biggest transactions most of us will make. In fact, more than 8 of every 10 Americans prioritizes buying a home at some point in their life. Working with a financial advisor before, during and after purchasing a home can help make this pivotal decision more affordable, save you money on a loan and alert you to common pitfalls that affect some homebuyers.

It’s also important to balance your desire to purchase a home with your other financial goals, which could include setting aside money for a child’s college education or funding your own retirement. The best financial advisors can help you analyze your goals and explore different scenarios for accomplishing what you’ve set out to do.

Change is stressful, so seek financial guidance when you’re preparing for a wedding, starting a family, changing careers or in the middle of a divorce. These events – some advisors call them “triggering events” – are critical periods for planning. That’s because decisions made in the midst of these time periods often have repercussions and consequences far into the future.

Clients preparing for a wedding, or those who have recently tied the knot, often have questions for our advisors about merging their finances, how their taxes will change and what steps they need to take to ensure their loved ones are cared for if a spouse dies or becomes disabled.

For clients starting a family, our advisors field inquires about saving for college, buying a new home or helping their children become financially literate. We also help our clients establish an estate plan, so that they can ensure the wellbeing of their beneficiaries long into the future.

Career-changers work with our advisors to ensure their exciting new professional path will still lead to their goals, whether that’s a new home, a different journey to retirement or to launch a business. The best advisors know that there’s no one-size-fits-all to financial planning and investment management, so advisors will listen closely to what you want to achieve and help you evaluate your options.

Clients experiencing a divorce often work with our advisors to address changes to their retirement plans, beneficiaries and estate plans. As you chart a new path forward, our advisors will help guide you and position you to best achieve your goals.

Deciding when you should work with a financial advisor is a personal choice. Some clients choose to work with an advisor as soon as they can, relying on a professional to guide them through their goals and the challenges they encounter along the way. Others may decide to wait. We’ve found that once a client’s financial situation becomes complicated, is emotionally taxing or becomes overly inconvenient, it’s time to seek professional guidance.

We work with people from all walks of life, who have different goals and different levels of wealth. Our rule of thumb is this: if you’re considering whether a financial advisor is right for you, schedule a meeting to discuss your situation and let us answer that question together.

Take the first step. We’ll be right there with you.

Renter, E. (2023, January 24). Home Shoppers to Face High Rates, Economy With Resolve. NerdWallet. NerdWallet 2023 Home Buyer Report