"If you don’t have your health, you don’t have anything.”- Chuck Pagano
Those who care about their well-being take steps to preserve their health: they eat healthy, work out regularly, nurture their important relationships, and maintain work-life balance. But I continue to see Americans overlook one important factor in maintaining well-being: their financial health.
Even professionals outside of the industry would flag this as a cause for concern. A new study found that “perceived financial well-being—feeling secure about not only the state of your current situation but how well you’ve planned for the future—holds the key to your overall well-being.”1 Your financial security can affect you as much as job satisfaction, relationship stability and physical health combined.
Choosing a Financial Advisor
Fortunately, Americans have the opportunity to work with financial advisors to take care of their financial health. Financial advisors can be of service to everyone—not just the wealthy. It’s tempting to think we can plan for the future all on our own. And, sharing personal financial details with someone we don’t know can make us uncomfortable. That’s why it’s important to find someone you can trust. Don’t hesitate to ask for references in your social circle. Current clients can give you deeper insight into how an advisor approaches relationships.
Your memories are marked by personal milestones, not market events. When choosing a financial advisor, you’re choosing someone who should care about the bigger picture—the people and goals that mean the most to you. Credentials and experience matter, but your advisor also needs to ask the right questions: What does a “comfortable” retirement look like to you? What kind of legacy do you want to leave behind? An advisor who listens well will learn enough about you to do the behind-the-scenes work that makes the onstage version of your life a reality.
Sound Information to Make Sound Investments
Choosing to work with a financial advisor instead of taking on financial planning alone can provide the chance to take advantage of opportunities that could otherwise go unseen. For example, maybe you think your financial situation is relatively simple. Perhaps you and your spouse own a home and both have full-time jobs, you do a little extra consulting on the side, and you have two kids. You’re wondering how much to save for retirement and your kids’ college and how to make the best use of a small inheritance. You’re also lucky enough to have a job with a pension.
A financial advisor will have a wealth of follow-up questions: How long has this inheritance been sitting in the bank? This extra money could be used to fund 529 plans or reduce taxable income while helping you save for retirement. If your consulting work provides expendable income, could it be contributed to a SEP IRA? Is there an estate plan in place? Have you integrated 401(k) and 403(b) plans into your investment strategy? Have you reached the limit on your employer’s matching contribution? Does it make sense to consider a Roth conversion or use a Roth 401(k) at work? Have you considered an annuity with a death benefit protection to provide for your heirs? What are your plans for your pension – have you weighed the benefits of taking a lump sum vs. an annuity?
Your advisor can answer these questions so that you maximize your opportunities to protect and grow your assets. Even more important, they make the process of integrating all these different variables seamless. The amount of time you could spend trying to do this on your own would take you away from the very life you’ve saved for.
Beyond Financial Security: Pursuing Your Future Dreams
Advisors can uncover hidden opportunities to fund your dreams and take care of your loved ones. Nobody wants to look back and wonder if they could have done more for their financial health. Starting a conversation with an advisor and working with him or her to plan for the future can give you the reassurance that you’re doing everything you can to ensure your financial well-being today and tomorrow.
Investing involves risk and possible loss of principal.
The opinions and forecasts expressed are those of the author and individuals quoted and should not be construed as a recommendation or as complete.