If you think financial advisors are a waste, here are six reasons why they aren’t

Share on pinterest
Share on facebook
Share on twitter
Share on reddit

Managing finances properly is a crucial life skill. Everyone needs to know how to balance a checkbook, pay their bills on time, keep their credit rating in good order and create an overall life fiscal plan. Many people have a basic financial education.

However, specific circumstances often require an understanding of complicated details. This is where working with a financial advisor can be of great help. A financial advisor can offer many kinds of help from retirement planning to help with local tax laws. Financial advisors help people make sense of terms that might be otherwise unclear.

With their assistance, anyone can discover how to make the best use of their available funds throughout every life stage.

Six benefits to using a financial advisor

Buying a Home

Buying a home has many different benefits. Buyers can decorate the home to their own taste, expand it to accommodate a new family member and help build equity, or choose to sell the home. While buying a home is a chance to get a great place to live, it can be a complicated process.

A financial planner can help sort out all possible financing options. They can help you decide which mortgage makes sense based on your background history. If you have less than ideal credit, a financial planner can help you find the best mortgage rates, thus saving you money on your home.

Estate Planning

Many people leave behind assets when they pass away. A financial advisor can help figure out how to best dispose of such assets equitably.

For example, a person may have more than one home including a beloved home by the sea. Deciding how to provide heirs with access to the beach home or allowing them to sell it is yet another area where a financial advisor can provide much-needed guidance.

A fiscal advisor can also help people determine how best to donate to charity or even establish a charitable foundation for a cause they hold dear.

Insurance Assistance

Insurance is hugely important. Insurance helps protect people from sudden losses. For example, health insurance is especially crucial.

Health insurance will pay many of your bills if you get sick. It will also pay bills for a routine checkup. This way, you can get preventative care like flu vaccines that will help you stay as healthy as possible. The same is true for other types of insurance such as car insurance and homeowner’s insurance.

Choosing between different kinds of insurance policies means making decisions that may affect a person for the rest of their lives. A financial advisor can help people with details such as what kind of insurance to purchase, how much to spend and the details of co-pays they need to understand.

Specific Retirement Accounts

Retirement planning should be started as early as possible. This allows people to build up a financial cushion that will serve them well when facing retirement age.

A fiscal advisor, for example, can help people decide if they should take early retirement and dip into their social security benefits or wait a few years in order to gain a larger sum of money. The fiscal advisor can also show them how much they need to save in order to get the funds they’ll need to retire comfortably.

Tax Benefits

Taxes are a fact of life. Everyone needs to pay taxes. A financial advisor can help you figure out how best to minimize the financial tax burden.

They might suggest a strategy such as investing in municipal bonds that may carry lower tax rates than standard forms of investment income.

A fiscal advisor can also assist with property taxes on homed and use all available tax investment strategies to keep as much money as possible.

Varied Life Stages

As people pass move through life there will be many life stages. They need to have a financial plan in place for every single life change. For example, when people first start considering financial possibilities, they may have college loans that they would like to pay off as soon as possible. As we age, many people want to do activities such as get married, start a family, and purchase a new home. A financial advisor can help with every stage of life.

Brittany Waddell is a contributing writer and media specialist for NextGen Wealth. She often produces content for a variety of finance blogs.

3 thoughts on “If you think financial advisors are a waste, here are six reasons why they aren’t”

  1. Nice list of benefits to using a financial planner. I’ve met with a few financial planners. I have yet to sign up with one. The biggest road block for me is that I don’t want to give up control of my finances to a financial planner. They tend to want to manage a portion of my wealth in exchange for a %. I find losing direct control of my finances very scary.

  2. I agree with Sport of Money. None of the six reasons require advisors to control your finances.

    I would also point out that as one increases their financial literacy, the need for a financial advisor decreases or the value of the financial advice become less valuable but the cost does not decrease.

    For those more financially sophisticated, I will admit that if a financial advisor charges by the hour and the rate is reasonable enough, a financial advisor can serve as a valuable, impartial third-party to validate your financial plans. If you are confident enough in your own financial acumen, this is unnecessary but most people feel better when an independent analysis comes to the same conclusion as your analysis.

  3. Why don’t people use financial planners?
    1. You’re a scaredy cat!
    2. You’re a nice person but you’re hopeless.
    3. You’re an egotistical, know it all.
    4. Money is more important than anything to you.
    5. Money isn’t important at all to you.
    6. You don’t have a sense of urgency.
    7. You’re a control freak.
    8. Failure and frustration gets you down and you don’t want to be reminded or admit your failures to others

Leave a Comment

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.