Consumers often mistakenly believe that financial planners are mainly investment advisors, but the fact is that genuine financial planners provide a broad range of financial advice for a broad range of personal financial situations. The following are 14 reasons or situations where you may want to seek the services of a qualified financial planner.
- Organize and manage your finances. Many of us have complex financial lives, yet lack the time, expertise, discipline and objectivity to put our financial house in order. A planner can examine your overall net worth and financial situation, help you identify your life goals and objectives, and recommend strategies that strive to get the most bang from each dollar you earn and spend so you can achieve your life goals.
- Marriage and children. Blending two independent financial lives can be complicated and stressful, particularly if there are conflicting financial personalities or there were previous marriages. It’s critical to address such issues as insurance, titling of assets and delegating money management duties.
- Divorce. Breaking up a marriage is frequently far more financially devastating than the impact of even a long bear market. The planner can help transfer the clients’ assets and reallocate according to the new situation.
- Receiving a financial windfall. Inheriting a substantial sum of money or winning the lottery commonly brings relatives or product sellers with investment “deals” for you. Running them past a planner can eliminate the inappropriate ones. But, windfalls often involve other financial and non-financial factors. For example, it may be better to put the money toward debts, or you may want to donate some of it to charity. Inheritance in particular is often fraught with deep emotional issues and family conflicts, so independent outside advice can be invaluable.
- Planning for retirement. Investment decisions are naturally a critical component of retirement planning. But often overlooked are how best to withdraw funds from your nest egg once you retire, and especially what kind of retirement you want to live. A planner can help you crystallize your retirement vision, then design a plan to help achieve that vision.
- Funding for college. Beyond selecting among a plethora of investment options, other key issues include financial aid and tax considerations. Families also should examine closely the trade-off between funding college versus funding retirement.
- Facing a financial crisis. The loss of a job, a serious illness, a legal problem or a natural disaster might prompt the seeking of financial advice.
- Career advice. Planners can advise you on the financial consequences of a career change, compensation or severance package, stock options and retirement plans such as deferred compensation and 401(k)s.
- Running a business. A planner can help every step of the way, from buying the business to setting up a retirement plan for the owner and the employees, and, most often overlooked by owners, creating a realistic succession plan.
- Buying and selling a home. A home is typically the largest purchase a family makes, and generates numerous questions a planner can help answer. What type of mortgage? For how long? How much should I borrow? What are the tax ramifications? Should I pay points?
- Death of a spouse. All too frequently the surviving spouse hurriedly and under great stress makes critical long-term financial decisions involving insurance, investments and retirement plans. Rarely is there a more important time for informed, objective outside advice.
- Charitable giving. Families blessed with enough discretionary income and assets may want to make substantial donations to one or more favorite charities. But there are many options, some of which can save you more in taxes and thus leave more to the charity.
- Insurance. While an insurance agent can always sell you insurance, a financial planner can analyze your insurance needs (many of which people overlook such as disability and long-term care) in relation to your overall financial circumstances and goals.
- Estate planning. A death in the family prompts many people to come to planners to discuss wills, living wills, powers of attorney, life insurance, trusts and other estate planning issues. You’ll still need an attorney to draft the documents, but the planner can put those documents in the context of your financial circumstances and your vision of how you want your estate dispersed.
We at Wealth Management Associates have two Certified Financial Planning professions available to support you. Brian Damiani, CFP®, and Jon Sullivan, CFP®, are available to assist you when you are ready. If you’d like more information, please contact us directly at 925.462.6007. We look forward to hearing from you.