Don’t Wait Until It’s Too Late to Hire a Financial Advisor

 A lot of people put off hiring a financial advisor because they think they can handle their finances on their own or worry that it’s too expensive.

But if you start early, you can benefit from their expertise and avoid costly mistakes.

A financial advisor can help you navigate through financial challenges, from retirement planning and investment management to tax optimization and risk management.

How Many People Have Financial Advisors?

Recent data suggests that there’s a major gap between how many people need a financial advisor and how many have one.

According to a 2022 Intelliflo survey, about one in three adults in the U.S. use a financial advisor. More than 70% of Gen Z and Millennials surveyed said they need financial advice but don’t know where to turn for it.

And two in three Americans agreed that a tailored financial plan built around their goals would be extremely important to them.

Why People Wait to Hire Financial Advisors

Here are a few common reasons people put off hiring a financial advisor:

  • Perceived cost: In Intelliflo’s survey, the biggest barrier that prevented people from seeking out a financial advisor is the cost. 35% of participants assumed they don’t have enough money to afford a financial advisor.
  • Procrastination: Many individuals delay hiring a financial advisor due to a tendency to put off making important financial decisions.
  • Lack of awareness: Some people simply aren’t aware of the benefits that come with having a financial advisor.
  • Time constraints: Busy lifestyles and demanding schedules can keep people from dedicating time to finding a financial advisor.
  • Overwhelm: There’s a lot of financial information out there, and it can be overwhelming, causing some people to delay seeking help from a financial advisor.
  • Uncertainty: Sometimes, people’s uncertainty about their financial goals makes them postpone hiring a financial advisor until they have a clearer understanding of their needs.

Why You Shouldn’t Wait to Hire a Financial Advisor

The right financial advisor can change your financial life for the better and help protect you from making detrimental money mistakes.

But most people tend to wait until close to retirement to hire a professional. Often, that’s too late.

People need financial planning in their 30s, 40s, and 50s when they’re juggling saving for retirement and paying down student loans or credit card debt with major purchases like their first home or car.

Another part of the problem is that, until recently, financial services companies were designed to work with people who have a lot of money—usually requiring hundreds of thousands or millions of dollars in investable assets.

Thanks to technology, though, financial planning is becoming more accessible. For example. J.P Morgan Personal Advisors offers digital personal advising to clients with a suggested minimum of $25,000 to invest.

The service offers personalized financial plans from certified advisors, investment management, and one-on-one consulting.

It’s a great option for people who want more than automated portfolio management, which is what robo-advisors like Acorns, and Betterment offer, but can’t afford to pay for a traditional financial advisor.

Disclaimer—I’m a big fan of robo-advisors. These platforms are using technology to lower the barrier to entry to financial services and are worth checking out—but they don’t offer comprehensive financial planning.


Benefits of Hiring a Financial Advisor

Consider some of the ways a financial advisor could benefit you and enhance your finances:

  • Expertise: Financial advisors have extensive knowledge and expertise in various areas of finance. They can give valuable insights and guidance tailored to your specific financial goals and needs.
  • Objective Advice: Financial advisors who are held to the fiduciary standard prioritize your best interests. They can offer unbiased advice, helping you make informed decisions that will benefit you.
  • Financial Planning: A financial advisor can help you create a comprehensive financial plan. They’ll evaluate your current financial situation, identify your goals, and develop a strategy to achieve them.
  • Investment Management: With their knowledge of the financial markets, financial advisors can help you develop an investment portfolio that aligns with your risk tolerance and financial goals. They’ll monitor and adjust your investments as needed to maximize returns and minimize risk.
  • Tax Optimization: Financial advisors can help you navigate the complex world of taxes. They can suggest tax-efficient strategies to minimize your tax liability and take advantage of available deductions or credits.
  • Risk Management: A financial advisor can assess your insurance needs and recommend appropriate coverage to protect you and your family. They can also help you understand and manage other financial risks, like market volatility or unexpected expenses.
  • Retirement Planning: Planning for retirement is crucial, and a financial advisor can guide you through this process, helping you calculate retirement savings, choose the right retirement accounts, and develop a strategy to ensure a comfortable retirement.
  • Time-Saving: Managing your finances can be time-consuming. By delegating these tasks to a financial advisor, you can free up your time and focus on what you love.
  • Peace of Mind: Knowing that you have a professional overseeing your finances can provide peace of mind. A financial advisor can help you navigate economic uncertainties, provide reassurance during market downturns, and keep you on track toward your financial goals.
  • Long-term relationship: Hiring a financial advisor often leads to a long-term relationship. This allows the advisor to understand your evolving financial needs and provide ongoing guidance and support as you navigate through different life stages and financial challenges.

Bottom Line

People in their 20s, 30s, and 40s could really benefit from professional advice. After all, that’s when a lot of major expenses start popping up—a professional can help you figure out how to cover those costs, while also paying down any debt you may owe and saving for retirement.

There are even specialized financial advisors for millennials. That said, if you’re in your 50s, 60s, or beyond, it’s never too late to get help.

Having someone familiar with your financial situation on your side in both good times and bad will give you peace of mind and help you reach your goals.

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