Ask any American and they’ll tell you—we have bad money habits.
In fact, a recent survey shows that 95% of respondents believe US residents waste more money than they should. Obviously, those people are implicating themselves among others, admitting their own financial faults.
That same study revealed common ways to waste money—dining out, impulse buying, purchasing name brand items over generic ones—as well as the most cited bad behaviors, like upgrading functioning items to newer models, making redundant purchases, and neglecting to hunt for discounts, to name a few.
Is it time to hire a financial advisor? If you’re experiencing money woes (and you check ‘yes’ to a few of these spending habits), having someone to get things back in order may be your best bet.
First, Know What You Want From a Financial Advisor
Financial coach, financial advisor, finance professional—these are all terms used to describe somebody who assists you with your finances.
Under that umbrella, though, you’ll find advisors with varying levels of expertise. Some advisors work with large corporations while others work for your typical homeowners. Some have the power to sell individual stocks or bonds while others do not.
Narrowing down the type of advisor you choose depends on your money goals. Do you need help recovering after bankruptcy, making a debt payment plan, or just want advice on investing? Answer these questions first, then find an advisor that meets the criteria.
Second, Get Recommendations, Have Consultations
Just like any residential or commercial hire, having consultations after receiving recommendations is a fantastic way to vet them.
Ask your fellow homeowners or businesspeople who they’ve used and how much money an advisor saved them. What were there strong suits or shortcomings? Did the upfront cost pay off in the long run?
If you come across any promising reviews, schedule an initial consultation with an advisor to make sure they’re the right fit for you. One of the best determining factors is your budget, covered next.
Finally, Consider Your Budget
You guessed it—hiring someone to help you manage your money costs money. Of course, the end goal is to make more money down the line after advice from your coach.
The best financial advisor for you is one that charges less than what they’re saving you—allowing you to both pay them and have a lucrative future thanks to them. Advisors charge in various ways, such as:
- Flat fees
- Fee-only
- Percentage-based (usually ranging from 0.5% to 2%)
- Commission-based
Remember that while you’ll likely need to pay an advisor upfront, the goal is to save money long-term, making this initial investment worth it.
More Money, Less Problems
The right financial advisor for you depends on your current money habits—and what you plan to do with your money.
In general, though, they should be able to help you get your numbers back in line or at least prepare a plan to. They should offer sound financial advice that makes managing your money easier than it currently is. Finally, they may even be able to help you earn a dollar or two on investments, high-interest savings accounts, and more.
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