Why Have a Financial Advisor

Fiduciary investment and financial advisors all looking at a laptop in office discussing financial matters

During a traumatic life transition, your decision making ability can be compromised.

Your emotional stress can become compounded by your newfound financial anxiety. Your mind is bouncing around a mile a minute and your to-do list can get lengthy – quickly!

The combination of stress and the sense of urgency needed to navigate financial transitions can lead to rash decisions being made with disastrous outcomes. This is not hyperbole. According to Forbes, 70% of all wealth transfers fail.[1]

But you do not need to be overwhelmed. By staying involved and developing a financial plan you can manage any life transition, expected or unexpected, that may arise.

A financial advisor can provide you with clarity about your financial outlook, giving you the answers to questions of what the “new normal” will look like. These questions might include:

  • “Do I have enough to maintain my current lifestyle?”
  • “Do I have to go back to work?”
  • “Can I travel?”
  • “Can I keep my house?”

All of these big picture questions may keep you up at night if you try to tackle them alone. Having a financial guide to help answer these questions and shepherd you along your financial journey could provide great relief.

Proactively Prepare for Difficult Transitions:

1. Be an informed financial partner in your relationship. Discuss your financial logistics – where your accounts are located, what liabilities you have, list any life insurance policies, etc.

2. Introduce your spouse to your professional network. Acquaint them with your insurance advisor, estate advisor and financial advisor. You would be surprised how many spouses and family members are unaware of their family’s network of professional advisors.

3. Have open, thorough money discussions. Do not reserve money discussions only for major life transitions and decisions. Always be involved so you can reduce roadblocks and conflict.

4. Do not just manage these situations, plan for them! A good financial plan will not only give you clarity and ease your concerns, but it also gives you and your family the best opportunity for success.

5. Be prepared to tackle tough subjects with the entire family, such as wealth transitioning. The main cause of failure in 70% of all wealth transitions is the lack of any post-transition strategy.[2] There were no signs of poor legal, tax, or financial advice. In the 30% that were successful there was a plan that not only gave responsibilities to the spouse, but also to children and even grandchildren in some cases.[3]

By staying informed you will be better equipped to make any major life decision that has a financial implication—which you may quickly find out is most of them. Whether they are family decisions, like marriage and having children, or professional decisions, like changing careers and going back to school, it is important to understand the financial impact of any decision. Maybe it’s time to talk about money.

Hewins Financial Advisors, LLC and Wipfli Hewins Investment Advisors, LLC (together referred to as “Hewins”) are investment advisers registered with the Securities and Exchange Commission under the Investment Advisers Act of 1940. The views expressed by the author are the author’s alone and do not necessarily represent the views of Hewins or its affiliates. The information contained in any third-party resource cited herein, including but not limited to other blogs, websites or articles, is not owned or controlled by Hewins, and Hewins does not guarantee the accuracy or reliability of any information that may be found in such resources. Links to any third-party resource are provided as a courtesy for reference only and are not intended to be, and do not act as, an endorsement by Hewins of third party or any of its content or use of its content. The standard information provided in this article is for general educational purposes only and should not be construed as, or used as a substitute for, financial, investment, or other professional advice. If you have questions regarding your financial situation you should consult your financial planner, investment advisor, attorney or other professional. Hewins is a proud affiliate of Wipfli LLP. A copy of Hewins’ current ADV Part 2A discussing Hewins’ investment advisory and financial planning services and fees is available for review upon request or at www.adviserinfo.sec.gov.

[1] Rosenblatt, Carolyn, “Wealth Transfers: How to Reverse the 70% Failure Rate,” Forbes, December 9, 2011, https://www.forbes.com/sites/carolynrosenblatt/2011/12/09/wealth-transfers-how-to-reverse-the-70-failure-rate/, accessed May 2013.

All examples are for illustrative purposes only and are not intended to provide individual financial, investment, tax, legal or accounting advice. This material is for general information and is subject to change without notice. Every effort has been made to compile this material from a reliable source. However, we cannot guarantee that information will be accurate, complete and current at all times. Before acting on any of the above, please make sure to see a financial professional for advice based on your personal circumstances.

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