This is probably one of the most common questions I get from people when I talk to them for the first time. “Do I even need an advisor”, “I hope I am not wasting your time”, “I probably don’t have enough money to be your client”, “my finances are such a mess” These are all phrases I hear on a regular basis.
First things first, you are absolutely not wasting a financial planners time by asking a few questions to find out if they are someone you want to hire. If the planner makes you feel that way, please feel free to find someone with a kinder heart. Second, there is a financial planner out there for everyone. You do not need to be rich already or to have all your financial ducks in a row to find a financial planner. There are many different types of advisors out there looking for all kinds of clients! Keep looking until you find the right person for you. It might take a little searching to find the right fit, but it will be worth the effort.
Since we have established that you as a potential client are absolutely not a burden and that there is a financial planner for everyone, here are a few things that can help you determine if YOU are ready for a financial planner at this stage in your journey.
You are ready to learn about your money
More than anything else, a financial advisor is a partner in education. Our job is to help teach you about your money and the financial options available to you. The best way for you to be successful financially is to be empowered to make well informed decisions. Do not be misled by someone who wants to make all the decisions on your behalf. You should understand your options any time you are making a financial decision and feel confident with the education your planner provides to you. At the end of the day, its your money. So at the end of the day, its your decision. As long as you are ready to commit to learn more about yourself and your finances, you are ready for a financial planner.
You feel lost in a sea of information
Before reaching out to a financial professional, you probably did some research on your own. When it comes to finances, it seems that everyone has an opinion. Your parents, grandparents, and friends, bloggers on the internet, well known financial gurus, the neighbor walking their dog. Everyone seems to have a different opinion, and everyone is absolutely convinced THEY are the ones that are right. The truth is, while there are some foundational principles of finance that are universal, everyone has a financial situation that is unique. There is not one simple template that will take into account your current financial situation, your unique dreams and goals for your future, the specific challenges that you are facing, and your definition of success. A financial professional can help you to identify your goals and create a roadmap to work toward those goals in a way that makes sense specifically for YOU. If you are ready to have someone filter out the noise, you are ready for a financial planner.
You understand that good Financial Advice isn’t free
Just like every other profession, financial advisors will require some sort of payment for their services. If someone is giving you advice for “free”, I would urge you to be very cautious. Free advice might be worth exactly what you paid for it. You wouldn’t agree to do a job for no money, and a good financial advisor won’t either. Financial advice is going to cost you something, one way or another. Good advice with a known, agreed upon fee is much better (in my opinion) than advice you might receive that could be tied to hidden commissions or poorly researched for your specific situation. If you are ready to pay for quality advice from a professional, you are ready for a financial planner.
You have paid off all (or most) of your debt
This is a bit of a matter of preference. I recommend you pay off most, or preferably all, of your debt other than your house before hiring a financial professional. If you are paying high interest on a credit card or a car loan, paying those debts down will generally be a better use of your flexible income than investing. As I said before, you will be paying something for the advice you receive. If you hire a professional too early, it’s possible those funds spent hiring a planner will hinder your progress toward your goals. A financial planner may be able to help you plan to finish your debt payoff goals if you need a little encouragement at the end or if you’ve recently come into a large amount of money and you want guidance about how to best address your debt. If you are just getting started on your financial journey and are wondering how to begin paying off your debt, Dave Ramsey’s Total Money Makeover is a great place to start. You might also consider hiring a financial coach on an hourly basis to help you with your initial debt payoff plan or to help you get control of your budget. If your high interest debt is fully paid and you are ready to take your success to the next level, you are ready for a financial planner.
By even asking yourself these questions, you are already making steps in the right direction. A good, patient, comprehensive planner will walk with you on your financial journey as a partner and hiring when it is the right time for you can create a positive impact for many years to come. If you feel you are currently ready to take the next step, I would love the chance to speak with you. Please schedule a consultation so we can have the chance to get to know each other. I look forward to seeing you soon!