Having a financial advisor is like having
a tennis or baseball coach. While you want them to track your performance throughout
the year during routine practice, there are also key moments during a big game when
you look to them for important advice. So, when exactly should you touch base with
1. When you land your first job.
This is an excellent time to schedule a meeting with an adviser about setting up
a monthly budget and starting to save for retirement. If your employer offers a
401(k) plan, a financial advisor can help you decide how much to contribute and
how to allocate your contributions.
2. When you leave or change jobs.
If you’re taking a hit in income, your advisor can give you strategies about how
to adjust your finances until you find that next job. And they can walk you through
options regarding your 401(k) plan from your previous employer — such as rolling
those funds into an IRA or transferring them into a 401(k) through your new job.
3. When you get married. Getting
married can change your personal finances significantly. Are you going to merge
your funds or keep them separate? If you are now going to be a dual–income family,
what will you do with that additional income? What about life insurance needs?
4. When buying or selling a home.
An advisor can help you figure out exactly how much house you can afford and, along
with a tax professional, plan for any tax consequences. Finally, he or she can
help you adjust your budget to accommodate all of your home mortgage and maintenance
needs as well as continue to invest toward retirement.
5. When you have children. Children
are bundles of joy that can also cost your bundle. Getting professional advice about
how to manage child-rearing expenses can be extremely beneficial. An advisor can
also help you set up a dedicated college fund to plan for your child’s educational
needs down the road.
6. When you receive an unexpected
windfall. Whether it’s a large bonus or an inheritance, you want to plan for
any unanticipated funds. There can be tax obligations, and you need to make decisions
about how to spend or invest that money.
7. When you’re about to retire.
The transition from your income-generating years to retirement can be tricky to
navigate. Working with a financial planner all along will help smooth out the transition.
However, there will still be adjustments to how you manage your money, and an advisor
can help you during this critical time.
8. Every 6 to 12 months if nothing
major has changed. It’s important to touch base regularly with your advisor,
even if your circumstances remain more or less the same. Periodically review your
progress toward your retirement and other financial goals, such as debt reduction.
A good financial advisor can help you
train and prepare, recover from injury, and come up with a game-winning strategy
to get you over the goal line to your retirement years.