Not convinced of the importance of financial planning? Consider this:
38% of households live paycheck to paycheck.
51% feel behind on their retirement savings.
50% don’t have estate planning documents set up to protect their assets or their dependents.
Financial planning can help address all these issues, and help solve money issues for many people. These issues often stem from a simple lack of financial education and literacy; people just don’t know what the right answers are.
And too often, average people and average investors dismiss the idea that they can benefit from financial planning for various reasons.
But having a professional on your side, working as your fiduciary, can allow you to reach financial goals that might otherwise be beyond achieving. It’s time to bust some common myths around receiving professional advice about their money, understand the importance of financial planning, and learn how a financial advisor can serve you.
Yes, You Can Afford It
Too many people shy away from seeking help because they assume they can’t afford it. Thankfully, this is a myth!
Let’s look at it this way: How much do you pay for your monthly gym membership? Your cell phone bill? Do you pay to have your property landscaped or your car washed?
These expenditures help add value to your life, based on your priorities. They’re also easy to budget for, as they come in a set amount each month. It’s known and easy-to-understand how the costs work.
Financial planning can be the same way when you seek out a fee-only financial planner who offers a flat monthly rate to provide services to you. And of course, those fees aren’t just another expense. They’re an investment, and you can expect to see a return in the form of a better financial situation.
Financial advisors no longer cater to people who are already wealthy. They’re eager to help those on the road to financial success, not just those who have already arrived. And they’re making financial planning affordable.
You Can Eliminate the Conflicts of Interest
Trying to find the right options and best financial products for your situation can be overwhelming. There are countless options available, and it’s hard to sort through the noise.
How can you trust the advice you receive when you do need it?
By choosing a fee-only financial planner who doesn’t get paid for making recommendations to you.
If you want to invest a certain way, they can guide you with an objective eye. If you’re curious about life insurance, they’ll point you in the right direction.
Instead of commissions, fees are based on the actual services provided to you. Not only are newer models used by younger financial service providers more affordable, but they’re also free from conflicts of interest.
You Need a Financial Road Map
When is the last time you calculated your net worth, or knew the exact amount you owed on credit card or loan balances? Are you really invested in your future? Are you making saving for retirement a priority?
This is why financial planning is important: because keeping track of every last cent of your personal finances is a full-time job in itself.
When you’re distracted by your career, your family, your hobbies, your other goals outside of ones relating to money, your social life… it’s easy for financial issues to slip through the cracks of a busy, full life.
A trusted professional can answer your questions and work with you to develop a financial road map for your individual situation. They’ll help you identify where you want to go and how to get there.
It’s their job to work with you to handle the financial issues, so you don’t have to hit pause on the rest of your life to sit and worry through whether or not you’re making all the right moves with your money.
Everyone is working toward something in life. You have something to plan for, and something to manage — even if it’s just the potential for wealth.
You don’t have to have a multi-million dollar portfolio to take advantage of the services that financial planners have to offer.
Get Accountability and Advice to Make the Most of Your Money
If you’re a member of Generation X or Generation Y, now is the best time to start working with a financial planner. Thanks to the power of compound interest over time, saving while you’re young allows you to build exponentially more wealth than you’ll be able to do when you’re closer to your desired retirement age.
Of course, that’s easier said than done. This is another reason why a financial planner is so important to have on your team.
If you don’t think you have enough money to retire on (or don’t make enough to meet your financial goals), they can suggest investment and earning strategies that might help. A planner can also suggest saving and spending strategies to get the most out of what you have.
They can provide the accountability and the advice you need to not only get started with savings, but to also:
- Manage and eliminate your debts
- Create an emergency fund
- Plan for more than retirement: financial independence
- Utilize the right strategies for spending, saving, and investing
Time is on your side when it comes to personal finance. Make the most of it by getting the right advice now.
Even the DIYer Can Benefit from Financial Planning
Like to invest on your own, without assistance? Are you adept at tracking your spending, creating a debt payoff plan, or a savings strategy?
It’s always good to see people take action and educate themselves in their personal finances. But even the best-laid plans can benefit from a second pair of (trained) eyes.
The mistake a pro catches could save you thousands of dollars — or more. And a planner can help you make rational decisions when it’s hard to do anything but react emotionally to money issues.
Regardless of your situation, working with a financial advisor is an investment in yourself and your future. Financial planning is important so you can live the life you feel passionately about today, while still saving and setting up for a financially secure tomorrow.
That’s one of the best investments you can make, no matter what your stage of life.
Have questions or care to share your experience? Ask/share in the comments!
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