Broker Check
Financial Planning FAQ: Answering Your Biggest Questions

Financial Planning FAQ: Answering Your Biggest Questions

June 03, 2024

When it comes to financial planning, there are a lot of unknowns. Perhaps that’s why almost two-thirds of older adults have never met with a financial advisor to create a plan. It’s common to feel paralyzed by indecision, but procrastinating on a financial plan can have long-term consequences on your future success.


Oftentimes, people are held back by their fears and unanswered questions. To help with this, we’ve compiled a list of the most common questions we get asked when people are choosing their next financial advisor. We want you to be well-informed and confident as you begin the financial planning journey.


Q: How much money should I have before hiring a financial advisor?

A: We believe there is no limit to how much money you must have to work with a financial advisor. Most people are not taught money management skills in school, so everyone could benefit from the help and education of a professional. Our clients range from people still building their emergency funds to people donating as much money as possible to charity, and everyone in between.


When it comes to finding the right fit, we encourage you to avoid looking for someone to “hire.” We believe you should work with a financial advisor who you can see yourself developing a relationship with. Managing your life savings is deeply personal, not transactional. It’s important to build a relationship with someone you get along with and trust completely.


Q: What are the benefits of working with a financial advisor?

A: As financial advisors, we can provide unbiased advice because, while we care deeply about your success, we are not as emotionally invested in your decisions as you are. This can help you avoid mistakes like poor investment choices or missing blindspots in your plan. Advisors also have specialized knowledge in all areas of financial planning — investments, taxes, retirement planning, estate planning and risk management. This expertise can help you make more informed decisions. Plus, we often have access to specific financial products and strategies that everyday investors can’t obtain. In short, we have the education, experience and access needed to help you reach your goals as efficiently as possible.


Q: How often should I meet with a financial advisor?

A: Some people meet with their advisors often, while others feel comfortable waiting longer in between meetings. It all depends on what works for you, but there are a few general guidelines.


At a minimum, we recommend meeting with your financial advisor at least once a year for a comprehensive review of your plan. This allows you to assess your progress, make any necessary adjustments and ensure your plan is still aligned with your goals. In addition to annual meetings, it’s important to meet with your advisor whenever there are significant life events or changes to your financial situation. For example, getting married or divorced, having a child, changing jobs, receiving an inheritance or approaching retirement.


Finding the right frequency for you will depend on the complexity of your financial situation, your life stage and goals, how active you want to be in the planning process and the comfort level you have with your advisor. Ultimately, the key is to maintain open communication and meet with your advisor regularly enough that your plan remains on track and meets your evolving needs.


Q: Are you able to help young working professionals with their finances?

A: Yes, we work with a lot of young working professionals. Not too long ago, we were in their shoes! We understand the challenges many young professionals face, from building a family to kickstarting their savings. Getting sound financial advice early on can make a big difference in what your future financial picture looks like.


 Q: How long will my retirement savings last?

A: The only way to know how long your savings will last is to create a comprehensive financial plan because the number in your savings account does not tell the full story. Your money will last a certain amount of time depending on multiple factors: How much money is coming in? How much money is going out? What are your investments earning? How high is inflation? What is your tax liability? Plus, your spending habits play a large part in this. Some of our clients retire on almost nothing because they have a low cost of living, while others need a large nest egg to maintain their lifestyle.


People have tried to put an exact number on how much money you need to retire — $1 million being a longstanding goal to strive for — but the truth is, the only way to find out how long your retirement savings will last is to make a plan that factors in all the unique factors of your financial situation. No two retirements are alike, which is why it’s important to meet with an advisor who can create a plan that fits your needs.


Q: Are your financial plans personalized to each individual person?

A: Retirement planning should be based on individual goals, which is why we start by understanding what’s important to our clients and use that information to create a customized financial roadmap that helps them reach their dreams. We see and hear a lot of financial advice that is unhelpful because it’s too generic. For example, many clients come to us with Roth accounts because they were told they should have one, but this isn’t true for everyone! Some of our clients die without ever touching their Roth accounts because it doesn’t make sense to use them. The decision between a Roth and a traditional savings account is a tax question: If your tax bracket will be lower or equal in retirement compared to what you’re paying now, a traditional savings account is the way to go. This is the kind of individualized advice you should get from a good financial planner.


What is included in my financial roadmap?

A: Our customized financial roadmaps are designed to each client’s needs. We use a comprehensive aggregation tool that collects and analyzes thousands of potential outcomes to create a clear path to accomplishing your financial goals. Your personalized roadmap will take multiple factors into account and create a report that includes:


  • Personal Information: A summary of your basic personal and contact details, which includes information about your family members for beneficiary and legacy planning purposes.


  • Financial Goals: Your short-term, medium-term and long-term financial goals. This includes things like saving for retirement, buying a home and funding your children’s education.


  • Current Financial Situation: A list of your current income, expenses, assets, liabilities, insurance coverage and other relevant financial information to give us a clear picture of where your finances stand today.


  • Investment Portfolio: An in-depth analysis of your current investment portfolio, including all asset allocations, returns and your unique risk profile, which helps identify opportunities for improvement.


  • Retirement Planning: A model to show your potential retirement income sources, expenses and withdrawal strategies to determine if you are on track to meet your retirement goals.
  • Tax Projections: An overview of the potential tax implications your financial decisions could have. For example, how would a Roth conversion before or after retirement impact your finances?
  • Risk Management: A review of your current insurance coverage, as well as recommendations to help protect your family and assets.
  • Estate Planning: An overview of your current estate planning arrangements and recommendations to ensure your wishes are properly documented.

From there, we walk through specific recommendations and action steps to help you achieve your financial goals. This is the bread and butter of our work: We love educating you on your opportunities and working together to create a strategy that fits your needs. We also stress test your plan for potential scenarios, such as changes to your investment returns or retirement age. It’s important to walk through all the possible outcomes to ensure your plan is designed to withstand uncertainty.

Please note: the depth and customization of the MoneyGuidePro report can vary depending on the financial advisor and the complexity of your financial situation.


Next Steps

While this is only a brief sneak peek into what it’s like to work with us, we hope it helps alleviate some of your apprehensions when it comes to working with a financial professional. If you want to learn more about how we can help you create a customized financial roadmap, reach out to schedule a meeting with our team.