How to Choose a Financial Planner

There are two types of people in the world financially — (1) Those that spend first and save last, and (2) those that save first and spend last; If you’re the type of person who falls into the latter group, then it may be time for you to choose a financial planner.

If you think you need to start planning your financial future but haven’t taken any steps to follow through, you’re not alone. Roughly 1 in 3 Americans have done nothing to plan for their future, according to CNBC.(https://www.cnbc.com/2015/04/29/one-third-of-americans-lack-a-future-financial-plan-study.html)

As you may already know, financial planners advise clients on how best to save, invest, and grow their money. Without a financial planner, people generally tend to make financial decisions without proper forecasting. This leads to issues being dealt with one at a time, at different times with different people under different circumstances.

You might not think that you need a financial planner to help you with your current financial situation. However, data shows that many people do not have a complete understanding of what a financial planner could provide. According to a 2017 survey (https://www.investopedia.com/updates/find-financial-advisor-planner/), over a third of Americans don’t have a good understanding of what a financial planner actually does. Furthermore, nearly half of Millennials indicated a lack of understanding. Not all financial planners are the same: Some specialize in certain practice areas, types of clients, strategies and products. So it is best to analyze your personal needs and goals before making a decision.

 

Times to Consider Hiring a Financial Planner may include:

  • You’re recently married
  • You’re starting a new business
  • Your family has grown
  • You’re planning a big purchase
  • You’ve received an inheritance

 

You may need a financial planner for many reasons. For example, you just received a considerable sum of money from a relative who died. Perhaps you just had a baby and want to ensure his or her future in case the worst happened. Maybe your company is offering a too-good-to-resist early-retirement package, and you want to make sure the money lasts. Any of these events (and many others) could naturally trigger the desire for some professional help in managing your financial affairs. 

Understanding your own personal needs and goals is critical before you select a financial planner. Knowing some basic, but important questions to ask your potential financial planner helps move the process forward.

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