Monday, February 11, 2013

When Should I Seek Help From A Financial Planner?

Here are three situations where the advice of a professional would be of great value: you want to retire within the next ten years, you have gone through a divorce or have inherited money.

Issues around retirement include the questions, “Can I afford to retire?” “How much do I need to retire?” and, “Will I run out of money?” Tracking spending, saving, investing and managing risks form the basis of retirement planning. To some extent, people can do many of these things themselves. Professional help is appropriate when

the questions or decisions become too complicated. For instance, seeking professional guidance when choosing the best mix of investments to meet one’s goals is a good idea.

Working with a planner prior to retirement is ideal. It’s never too soon to start saving. Seeking a planner after you’ve left the workforce or your business may still be beneficial, but beginning to plan ten years out gives you more time to maximize savings and investments. Periodic checks and adjustments to your plan will ensure sufficient progress while establishing reasonable expectations.

Divorce inevitably brings tremendous personal change. One must reassess financial priorities and decisions to meet the needs of the newly single person. Plans that always included someone else will no longer work. In a relationship one person may always have taken care of the money and investments. Divorcees may find themselves in over their heads. For example, they may require help making sure investments reflect their attitudes, risk tolerances and goals.

Inheritance brings its own set of concerns. Those who inherit may not have experience managing large sums of money and often worry that it could end up being frittered away if they don’t do something. Typically this means investing to generate retirement income, paying off a mortgage or planning for future medical expenses.

In all of these situations, a financial planner can be a valuable partner in establishing priorities and crafting strategies. A planner can suggest investments to improve returns resulting in more income for retirement, while analyzing and managing risks that could derail your long-term goals. A planner can integrate your values into a big picture vision that ensures your money is used in the best possible ways to support what you care about most (this is the closest you get to money “buying happiness,” by the way.) By looking out for your best interests, and helping you navigate complex choices around investments, a financial planner gives you something else – peace of mind!

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