While many people avoid working with a financial advisor because of the presumed cost, hiring a trustworthy, qualified advisor can actually be the best investment you make. Experts generally recommend seeking out an advisor prior to a major life event, such as a marriage, having a child, a job change, starting a business or retirement. Most people make the mistake of waiting too long to do financial planning and only do so after a crisis, such as a job loss, bankruptcy, divorce, death in the family or when they’re running out of money in retirement. In most cases, this procrastination leads to having to do more with less, which is a recipe for failure.
In my mind, any time could be a good time to hire an advisor if you feel like you need help developing, implementing and managing a suitable financial plan, which you should always do sooner rather than later, especially if you are anticipating a major life event.
The key is to interview a few different candidates and ask plenty of questions before committing to working with one. This way, you can make sure you are comfortable with that person and are fully aware of all potential costs, which can vary greatly by type of advisor. Keep an eye and ear out for any potential conflicts of interests, as many advisors are incentivized to sell particular products that earn them commissions. Make sure you know which investment and insurance companies an advisor is affiliated with and the potential pros and cons of those relationships. Also keep in mind that some advisors only work with clients above a certain net worth or amount of investable assets.
You ultimately want to work with an advisor you trust and who focuses on working with clients like you to help ensure that you get the attention and level of service you want and deserve. So do your homework and be prepared to spend money to make money — the long-term benefits can be well worth it.