Reader Question: Do I need a Financial Advisor? Or a Financial Planner?


Signs you may need to hire a Financial Planner

How do you know you may need the help of a financial professional? A Certified Financial Planner to be exact? Recognizing if you could benefit from professional advice is maybe a pretty good indicator you could use the help.  Here are a few more things to consider.

1. You have no idea where all your money goes

We all know what comes in. However, where it all goes is another story. You may have good intentions to live within your means, but somehow the pleasure of having or trying new things gets the best of us. For some, what comes in is barely enough to cover the basics, yet we continue to live in this fabulous manner.

If you have no idea where your money goes, or are living above your means, it is a sign you may need professional money help.

2. All that money you earn seems to disappear every month

You are smart, and have a great job, but somehow all that money you earn seems to disappear every month.  No one intends to rack up credit card debt, or live beyond their means, but it happens to a lot of people.  If you have had trouble getting your spending in line with income, or are not able to save enough to get on track for you financial goals: it may be time to hire a financial advisor.


3. You have no idea how to prepare for retirement.

Saving for retirement is a long marathon, not a sprint.  All the investment choosing, saving, 401k, tax nonsense can be very confusing, and stressful for even the most number loving among us.

Simply, there are 2 ways to go here: Plan for retirement or pray to win the lottery (ok maybe do a little of both).  If you want to make a smart choice I’d recommend planning for retirement.  30 years of retirement working at McDonalds is not appealing to me in the least.

If you make this choice as well, you should consider working with a trusted financial planner to help you map out what you need to be contributing to your retirement accounts to have enough money to live off in your golden years. They can also help maximize you tax deductions, employee benefits, and pick investments appropriate for your situation.


4. You Have no idea what all that stuff on your investment statements means, or worse you haven’t even opened your statements in forever.

It’s not as simple as “is this a good or bad investment”.  The real question is: are these investments appropriate for your time frames, type of account, time horizon, risk tolerance?   And of course will your investment with an estimated return and with appropriate contributions get you to your financial goals.

If you aren’t 100% sure, it may be time to find a fee-based financial coach to help you create a financial plan to help you get on track for all of your specific financial goals.

5. You have insurance policies that you don’t understand, or you know you need to have an insurance policy, but don’t know where to start.

Getting all the insurance you may need is not as easy as checking off a few boxes, or copying what you friends are doing.  Appropriate coverage is dependent on your situation, health, and family situation.  When disaster strikes you want to know you will be ok, understanding your policies helps to know what you might expect if end up disabled, or your house gets robbed.

By no means do you need to have all of you policies memorized, but it’s a good idea to have a general idea of the type of things they cover, and if that coverage is adequate.  It is also good to work with a financial planner who handles insurance to use as a resource when things go awry.

6. You have no plan in place in case you die or become incapacitated.

By far the least fun topic on this list, which may be why so many people skip this step when left to their own devices.

Basic estate planning can help you plan for where you assets will go when you are no longer around.  Also it allows you to choose how you will be cared for if you are incapacitated. I’d rather choose myself, and take the pressure off my loved ones to decide to pull the plug or not.


These are just a few glaring examples of people who may need a financial planner.  There are hundreds of other reason a person could benefit from working with a financial planner including the peace of mind that comes with having a comprehensive financial strategy, saved time, and having an experienced professional who has helped others before in analyzing difficult financial situations.

DAVID RAE, CFP®, specializes in retirement planning for the LGBT community. Follow him onFacebook on Twitter at @davidraecfp or via his website,


Securities and advisory services offered through National Planning Corporation, member FINRA, SIPC, a Registered Investment Advisor. Trilogy and NPC are separate and unrelated entities.