As much as I’d like to be an expert in everything, I’ve realized that isn’t possible. This leads me to seek advice from different experts in many different fields. You’ll see me consult lawyers for legal advice, accountants for tax advice, mechanics for car or boat trouble, or a doctor when I’m sick.
Although I love to save money where I can, I realize the best way to get a problem solved correctly is by letting an expert handle it.
But how do I know when it’s time to seek advice from a professional? In some areas, it’s easy to know when to seek advice, in others it’s tough.
In her book, “Advice That Sticks: How To Give Financial Advice That People Will Follow”, Canadian neuropsychologist and executive coach Dr. Moira Somers mentions eight reasons people seek professional advice:
- Reduce Complexity
- Take Action
- Save Time
- Offload Unpleasantness
- Increase Their Confidence
- Help Make Better Trade-Offs
- Receive Encouragement
- Feel Safer
The financial advisors at Ruedi Wealth are experts in retirement planning, and people seek our advice for many reasons. In fact, I have actually seen people seek and benefit from expert advice for all the reasons Dr. Somers mentions.
To Reduce Complexity
Building a truly comprehensive financial plan can be overwhelming. If done right, it will include a financial plan, investment management, tax management, and behavior counseling.
Each one of those sections of a comprehensive plan has its own lengthy list of to do’s on top of that. The sheer number of tasks that need to be done and moving parts that need to be considered can be overwhelming. A financial planner can make sense of all this and should condense it into a form that is easily understandable for you.
To Take Action
It is human nature to procrastinate on tasks that make us uncomfortable. Everyone has their thing that, “they’ll get around to eventually” and for some that’s planning for retirement.
Having a person that will not only hold you responsible, but will also complete most of the tasks for you can help you make sure you take action and don’t let things fall by the wayside.
To Save Time
Do you want to spend your time in retirement learning everything there is to know about retirement planning or do you want to focus on the things you love and retired for?
Whether that’s extra time with friends and family, picking up old hobbies, or volunteering at your favorite charity, time saved managing your finances is time spent on things you enjoy.
To Offload Unpleasantness
Dealing with personal finance issues can be unpleasant for people. It can be stressful, overwhelming, time consuming, and hard to talk about with your significant other. Sometimes it’s easier to have someone else work through difficult financial issues and complete the follow-up tasks related to the retirement planning process.
There is a lot of tedious legwork involved in financial planning and investment management. Some people who are capable of managing their finances themselves simply don’t enjoy the minutia of creating and tending to a retirement plan, and choose not to deal with it.
To Increase Their Confidence
I may be capable of changing my own oil or doing my own taxes, but I feel more comfortable and confident that a place that specializes in that service will do it right.
Retirement is supposed to be enjoyable and if you are constantly worrying about your retirement plans, then it may be time to let someone step in and give you that extra confidence you need to have a stress-free retirement.
To Help Make Better Trade-Offs
Sometimes people are too wrapped up in their own situation to realize all the options they have. An expert advisor can not only provide you with additional trade-offs you may not have considered, they will help you balance those trade-offs to make the right decisions.
Having a clear understanding of how decisions will impact their future makes investors more confident in their choices.
To Receive Encouragement
Sometimes people need words of encouragement to stay on track. This is especially true when life throws you financial curveballs, like an unfavorable stock market.
The worst thing a person can do is abandon their plan, because they’ll most likely do it at the worst time imaginable. An advisor help you through those tough times. Sometimes all people need is a little perspective on the situation and a little history lesson on what to expect.
To Feel Safer
As an advisor, I see first-hand the sense of safety people experience by having someone taking care of them and always watching over their plan. They worry considerably less about every little bounce in their investment portfolio and whether their financial goals will be impacted.
Choosing Your Advisor
My Dad always says, “you are either going to rely on an advisor for your financial well-being, or you will rely on yourself to be your own advisor; either way you are ultimately choosing an advisor.”
I personally seek advice from a professional unless I feel 100% percent certain I know what I’m doing. Though I may think I am capable of doing certain things myself, my experience in financial planning has taught me it’s very hard for people to spot issues if they don’t know they exist in the first place!
As a financial planner I have seen people seek, and benefit from professional advice. Actions get taken that would have been put off indefinitely; mistakes that would have been made are avoided. Less time is spent actually managing finances and more time is spent enjoying life.