Portfolio adjustments aren’t the only good reason to tap into the expertise of your financial advisor. Any time you’re facing a life-changing event or decision, there are likely to be both short-term and long-term financial implications.
In such situations, your advisor can not only offer helpful advice but can also use the information to make needed adjustments to your financial plan. Below, 13 members of Forbes Finance Council share situations in which your financial advisor can provide valuable guidance.
1. A Pay Increase
One important life change that clients should always seek the advice of their CFP about is an increase in their pay. A pay raise could move the client into a higher tax bracket or phase out their ability to push money in certain directions. The planner can update the client’s financial plan, providing them with the best way to handle the increased compensation. – Justin Goodbread, Heritage Investors
2. A Job Change
Throughout my career, I have seen many clients change jobs or shift careers entirely. Those who have had the most success have had conversations with my team before their move. My team and I have been able to help clients talk through their retirement and healthcare plan options. A career or job change is a significant event, and it’s always best to make sure you have reviewed it from all angles. – Steve Gansler, Janney Montgomery Scott
There are many situations where you’d need an advisor—retirement is the most common. However, marriage is also an important financial discussion, especially if it is a second marriage or you’re later in life. There are many different estate and tax implications, and titling and proper management of assets are paramount. – Gregory Kushner, Lido Advisors, LLC
4. Having A Baby
When you are getting ready to have a baby, there are plenty of costs involved, especially if you want to send your kids to college. Taking steps before a child is born can help you avoid rushing to take out loans when they are setting foot on campus. Building a nice college fund ahead of time can help your child avoid the financial burden of student loans that many are facing today. – Greg Herlean, Horizon Trust
Life changes are inevitable and can also be highly stressful—divorce is one example. It requires not only a lawyer but also, critically, the advice of a financial advisor. A financial advisor can be an objective voice to help you navigate the roadmap of the future and reduce the financial stress that often comes during this time of sadness, separation and legal discussions. – Sonya Thadhani Mughal, Bailard, Inc.
6. Supporting Grown Children
Financially supporting your grown children is a topic most don’t want to even consider, but it’s a reality for many. While you might not have an immediate answer, working with your financial advisor to set up an additional “buffer” to cover unplanned costs can at least put you in a position to help without harming your retirement plans. – Aaron Spool, Eventus Advisory Group, LLC
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7. Death Of A Spouse
The death of a spouse is debilitating, but there are mandatory items that have to be addressed when someone passes away—even when the surviving spouse is dealing with grief. In the midst of that, handling those issues properly will require assistance. The big question to answer is “Am I going to be okay?” Your advisor can help ease the anxiety you feel regarding your financial security. – Bill Keen, Keen Wealth Advisors
8. Changes In Family Members’ Lives
Keep financial professionals apprised of big changes in your family members’ lives. Family finances are often more interwoven than we’d like to admit. For example, parents approaching retirement may siphon off their savings to support their grown children—there may not only be expected expenses such as paying for college or helping with a house but also less-common expenses such as fertility treatments. – Jim Poolman, Indexed Annuity Leadership Council
9. Planning An Estate
Planning an estate is a common life change for which clients should seek financial advice. Analyzing various factors such as the arrival of children, the estate size, philanthropic goals, business succession and so on helps in the evaluation of assets. Consulting with an advisor to distribute and implement who gets what and who leads on your behalf is highly valuable for clients wanting assistance in the decision-making process. – Stacy Francis, Francis Financial, Inc.
10. Starting A Business
An important life decision is starting your own business. If you’re thinking about making the jump, it’s incredibly helpful to understand your personal financial runway and what objectives you’ll need to hit with the business to sustain your desired lifestyle. – Neil Littman, Bioverge, Inc.
11. Selling Your Business Or Inheriting Money
Selling your business or inheriting a large amount of money are two events for which you need to consult a financial advisor. Emotions can be difficult to navigate when the amount of money you have suddenly increases. The best financial advisors will give you the perspective to help you make the right decisions for you and your family. – Kyle Walters, The Personal CFO
12. Preparing An IPO
In the pre-IPO phase, employees or company founders with substantial equity awards would be wise to seek the counsel of a financial advisor in concert with a tax advisor. Having a well-thought-out plan in place that considers various outcomes for the company’s stock price, as well as the tax implications, can make or break financial security for a lifetime. – Kevin Dorwin, Bingham, Osborn and Scarborough LLC (B|O|S)
13. Taking Social Security
In my view, one of the most important financial decisions a person will ever make is when to take Social Security. Yet so often, individuals make this decision without any counsel based on preconceived notions about their longevity and the Social Security system. Consulting with a qualified advisor on this important topic can be a real game-changer. – Joshua Strange, Good Life Financial Advisors of NOVA
Successful finance executives from Forbes Finance Council offer firsthand insights and trends.