Despite this overwhelming amount of information, most experts agree that a wealth advisor (the living, breathing kind) is still the best resource for sound, consistent financial guidance, one that can even yield an additional 1.5-4.0 percent in the life of your portfolio. Whether it’s an engagement, marriage or baby, a promotion, inheritance or retirement, there are many ways a wealth advisor can help you manage your money.
The key to long-term financial prosperity is to make a plan and stick to it. While that sounds simple, staying the course through life’s ups and downs is no easy task. A wealth advisor is the taskmaster, the steady hand, the proctor at your final exam, making sure you keep your eyes on your paper. Rather than someone you see only when a crisis erupts, a trusted advisor is a regular presence in your life who reviews your portfolio, gauges your evolving taste for risk and adjusts course accordingly.
Every bull market eventually dips, and every bear market eventually recovers. It can be difficult to remember this when your accounts swell in good times or struggle in bad. That’s when your wealth advisor can be a steady hand that reminds you that you’re playing the long game.
In addition, an advisor can facilitate the tough conversations that will affect your financial plans, including saving for college or placing elderly parents in an assisted living facility.
Make the most of your money
Ideally, your advisor will work with you to create a complete snapshot of your income, expenses, assets and liabilities. This will inform in-depth discussions on savings, investments, insurance (which should include term life, long-term care and disability) and tax/estate planning.
While it’s good to keep some cash in a traditional, easily accessible bank or another low-interest account, inflation likely will decrease its value. Unless you’re Dan Brown or John Grisham, investments are the main tool at your disposal to help you grow your money and make your way to a comfortable retirement. Even in tough times, an investment portfolio should, over time, significantly grow your net worth. If that’s not the case, then a wealth advisor can set you back on track.
If you’re fortunate enough to come into an additional source of money—new job, big promotion or inheritance—an advisor can steer you away from purchasing that dune buggy or trip to Las Vegas and instead put your windfall to work, assigning a job to every dollar, be it savings, debt, taxes or investments.
In addition, some financial decisions are, by nature, more complex and require a higher level of literacy to adequately be addressed. These may include the best use of annuities or the solvency of long-term healthcare providers. It can be tempting to ignore these vehicles in favor of more easily digestible financial instruments, but an advisor can do that heavy lifting.
Manage a lifecycle change
No matter when you begin investing, good advice can lead you to the land of prosperity, offering guidance to those who are just starting out and saving them from potentially dangerous consequences. A good advisor’s expertise extends beyond investments and includes any number of potentially sensitive topics, such as buying a house, healthcare, legacy planning, family support, charitable giving and retirement.
Many of life’s most memorable milestones—engagement, marriage, baby, new home, new car—come with price tags attached and often require an advisor who can help sort them out. These may include childcare, salary disruption and saving for college. In addition, an advisor can draft an estate plan, which underpins all the joyous occasions mentioned above.
Which leads us to that most anticipated of crucial lifecycle events ...
Plan for retirement
No matter how diverse and shiny your portfolio, managing and growing your retirement nest egg is no small matter. It can be hard and complicated to openly discuss your current health and estimated longevity, which will have a tremendous impact on your resources and ability to work later in life. An advisor can act as a neutral third party who legitimately wants what’s best for your financial life.
If you plan to retire in 20 years but also aspire to send your child to Harvard, a professional can help you thread that needle to make both things happen. An advisor can also help you prepare for your financial life after death with comprehensive estate planning.
Build a prosperous future
TDECU has helped thousands achieve their most eagerly anticipated goals—we’re excited to talk with you and find out what’s possible.