5 Reasons to Work with a Financial Advisor

Shannon Nelson |

What Does a Financial Advisor Do?

A financial advisor is a person with knowledge of money management who provides financial services and guidance to clients. A good financial advisor can offer a wide range of services for your benefit. This expertise should span topics including advising on investments, financial planning, estate planning, retirement planning, inheritance planning, tax planning, and often times more subject areas. A financial advisor’s goal is to adjust to your changing circumstances and put together a strategy to help you achieve your financial objectives.

1. Making a Plan

Independently managing your finances demands a high level of investment knowledge, discipline, financial skills, and time. Despite increased access to information on the internet, it is difficult to obtain and assess all knowledge needed to make well-informed decisions about your personal finances and means of achieving your goals. Even with adequate knowledge, research, and financial instruments, many people do not have the time or discipline needed to manage their money.

 A financial advisor can help individuals’ address unique situations and provide resources to help you create a plan tailored to meet your needs. While taking into account your individual investment risk, goals, and circumstances, financial advisors formulate a comprehensive financial plan, and address how much you need to save and changes that should be made to help that plan become a reality. The financial world is filled with concepts, language, legal rules, and methodologies that require extensive research to understand.

Financial advisors will effectively guide you through various roadblocks you may face ranging from retirement plans and education savings to insurance needs, tax planning, and inheritance preparation.

2. Keeping You on Track                                    

While creating a financial plan independently is possible, monitoring your money and investments can be a full time job. With markets constantly changing and life circumstances and goals shifting frequently, financial plans must be updated and accounts may require periodic rebalancing. Many people who attempt to independently manage their financial and investment decisions often fail to stick to the direction and evolution of a solid financial plan, make emotional decisions, and can make costly investment mistakes.

Financial advisors, on the other hand, are dedicated to monitoring your progress, accommodating changes in goals, income levels, personal circumstances, financial opportunities, and market/tax laws. A proactive financial advisor will recommend strategies to help you optimize your after tax net worth while accommodating and planning for major life events and financial goals in between.

3. Preparation and Protection From Unexpected Circumstances

An important role of a financial advisor is to help you reduce financial risk. It is important that no matter what goals you have, you have money set aside in case of an emergency such as injury, illness, job loss, or damaged assets.

According to a Fidelity study, a 65-year old retired couple can expect to pay an average of $275,000 on medical costs during retirement. Without careful planning for these medical costs, money will either have to come from outside sources or medical needs will not be met. A financial advisor can teach you about long term care (LTC) insurance options to combat the costs of unexpected medical issues, describe the importance of having qualified and non-qualified assets for tax planning, and help you think about protection from unforeseen events.

4. Planning Your Legacy

Legacy planning is important if you have wealth that you would like to pass on to a future generation or beneficiary of any kind. Consulting an investment advisor and reviewing your goals, beliefs, beneficiaries, and investment accounts can help you make the most tax-efficient, secure transfer of wealth. Planning your legacy includes estate planning, inheritance, education, and the possibility of supporting charities/organizations.

With millennials set to inherit nearly $30 trillion over the next three decades, a financial advisor can help guide you and your family to a secure and efficient transfer of money and values to avoid negative outcomes for the beneficiaries. An advisor might suggest setting up trusts, charitable funds, or gifting strategies if appropriate.  To read more about legacy planning strategies supported by Heck Capital, please visit our 5 Tips To Get Started Legacy Planning blog.

5. Reaching Your Long Term Goals

To meet your long term financial goals, it is important to have a saving and investing strategy in place. A financial advisor can help you create a financial plan based on your specific needs and circumstances, and help you monitor and carry out the plan over a number of years. Whether your goal is paying for your kids’ education, buying a new house, or saving up for a vacation, financial advisors can help you prepare to reach that goal.

 For most people, a main goal is saving for retirement. Financial advisors have experience in managing retirement savings such as 401(k)s, Roth IRAs, Traditional IRAs, and pension plans through changing market cycles. If you have a 401(k) or other retirement assets, it is crucial that you are contributing the right amount. An advisor may also consider items such as receiving a company match, deferring taxes versus contributing to after-tax funds and other benefits unique to your industry or company.

In Summary

Hiring a financial advisor may provide a piece of mind in planning to meet your financial goals. Aside from professional advice and careful management of your hard-earned money, hiring a financial advisor can reduce a great deal of stress that comes with trying to manage your own money. Reaching your financial goals means spending money on the things that are most important to you now and saving money for your future endeavors.  

Consult an advisor at Heck Capital to learn more about how we can help you reach your goals.


Authored by Michael Bogard, CFA on September 27, 2018

About the Author:  Michael Bogard, CFA is a Business Development / Client Relationships Senior Associate at Heck Capital Advisors. Michael earned the right to use the Chartered Financial Analyst® (CFA®) designation after completing the program in 2018, fulfilling the work experience requirements, and gaining acceptance as a member of the CFA Institute. The Chartered Financial Analyst® (CFA®) charter gives a strong understanding of advanced investment analysis and real-world portfolio management skills. CFA® and Chartered Financial Analyst® are registered trademarks owned by CFA Institute.