Have you wondered if you need a financial advisor? Are you puzzled about the type of financial professional you need to help with investing, financial planning, selecting insurance, repaying debt, education funding planning, tax planning as well as estate and retirement planning?
Many titles, including robo-advisor, broker, investment advisor, and financial planner are used to describe financial advisors who help clients manage their money and achieve long-term financial goals. Although there is crossover among all groups, and many financial advisors hold multiple credentials, they can be described in general as follows:
Robo-advisors use computers to select and manage your investments. Some offer access to human advisors to answer questions, but their primary service is investment management, not financial planning.
Fees start as low as 0.25% of your balance and most charge 0.50% or less. Many have no or low account minimums, so you can start investing with a small amount of money.
Consider whenyou need help investing for financial goals like retirement, but don’t want or can’t afford a more holistic financial plan.
2. Online financial planning services
Relatively new to the market, these services offer investment management in conjunction with virtual financial planning. Clients typically meet with financial advisors by video or phone and receive comprehensive financial plans.
Fees, based on how much money is overseen for you, are described as “assets under management,” or AUM, that might range from 0.25% of your account balance to 1% or more, depending on the type of advisor you choose.
Consider when you are interested in investment management, a comprehensive financial plan, and ongoing access to financial planners for less than the cost of a traditional in-person advisor.
3. Traditional financial advisors
Working directly with clients to help them meet their short- and long-term financial goals, traditional financial advisors recommend specific investments and insurance products and may provide tax advice. In most cases, you’ll work with an advisor in your local area.
Fees will be based on a median financial advisor fee of about 1% of the assets managed for you, although some charge by the hour or have a set rate per service. Some require a minimum balance, such as $250,000 in assets.
Consider when you want specialized services, your situation is complex, or you want to meet your financial advisor in person.
Brokers work for broker-dealers—firms in the business of buying and selling securities (stocks, bonds, mutual funds, and other investment products) for customers. Brokers are required to make “suitable” recommendations for clients.
Fees are typically a mix of commissions and an advisory fee for portfolio-management services. Each firm has its own compensation formula. Statements show advisory fees and transaction costs.
Consider when you need guidance or broad advice on funds or stocks, or on how to divide your assets among stocks and bonds based on your age and risk tolerance.
Tips for finding the best financial advisor for you
Once you’ve decided which type of financial advisor is best for your situation and budget, you can start your quest of finding an advisor appropriate for you.
You should interview a few financial advisors before choosing one. Ask questions (including ones about philosophy on financial planning and investing, experience working with clients like you, and the number of years in practice) and check out their credentials and disciplinary history.
To vet a registered investment advisor, visit the U.S. Securities and Exchange Commission database, search an individual’s name, and find information on qualifications, employment history, disciplinary actions by regulators, and criminal convictions.
When you’re ready to seek a financial advisor’s assistance, prepare by arming yourself with your personal financial data and specific questions to find the right pathway. Then, you can store quarterly and annual reports as well as investment portfolio changes at insureyouknow.org.
It’s easy to procrastinate when it comes to writing your will. Not only is it unpleasant to think about your own death, but also determining how to distribute your assets sounds like a complicated process. You may not even know where to begin.
But begin you must. Creating a will and storing it somewhere safely like InsureYouKnow.org is one of the most important things you can do for your loved ones. A will ensures your wishes are carried out as you intended and your family is provided for and protected once you are gone.
Luckily, writing a will is actually a fairly simple process—especially if you get professional assistance. While you may be tempted to write one yourself using one many of the do-it-yourself kits available online, hiring an attorney who specializes in estate planning usually is the wisest decision.
Here are 6 reasons you should hire a lawyer to write your will:
- Your estate is complicated. If you have a very simple estate, you may be able to write your own will. But in general, that applies to a small pool of people. If you have significant assets, minor children, your own business, or other complicating factors, you definitely want to let a professional handle your will.
- You don’t want any mistakes. When it comes to your will, you want to make sure all your i’s are dotted and t’s are crossed. From getting the wording exactly right to making sure all your documents are properly signed and witnessed, there are a lot of steps involved in creating a valid will. Make sure it’s done right the first time so your loved ones aren’t dealing with a headache later.
- You want to save money. True, hiring an attorney isn’t cheap. Generally speaking, a lawyer will probably charge around $1,000 to draft your will—and it might cost more depending on your circumstances. But a lawyer also will talk you through various tax strategies that can save you and your family money in the long term.
- You need more than a will. When you use a basic template or create your will online, you’re getting a will. End of story. But an attorney will help you create a comprehensive estate plan. This will include your will along with a number of other important documents, such as a health care power of attorney and a financial power of attorney.
- You don’t know all the laws. Legal documents are complicated. Different states have different requirements. And the laws are always changing. There’s a reason lawyers are paid the big bucks: They know the laws, and they stay on top of them. A lawyer will worry about the details on your behalf.
- You haven’t thought everything through. You have a basic plan for your assets. You know who’s getting the house and how your savings will be divided up. Great! But who’s going to take care of your dog? What happens if you outlive one of your heirs? Lawyers have seen all these situations play out in real life and know how to address them in your estate plan.
Once you’ve created all your estate plan documents, it’s important to store them in a safe place and let your loved ones know where they are. At InsureYouKnow.org, we promise to keep all your critical files safe and secure. Simply upload your documents to our portal and let someone you trust know how to access them. Life is complicated; we help you uncomplicate it.