6 Benefits of Working With a Financial Advisor

We’re coming up on the new year in just a few weeks here. And, with it, many people will be back to the gym in pursuit of a healthier lifestyle. 

Typically, many of the New-Years-resolution-gym-goers will start dropping out of routine within a few months, back to their old habits. 

But what if they got a personal trainer? Someone who was invested in their success, kept them accountable, and showed them exactly what they should do? 

Chances are, they’d have better success. 

Financial advisors are kind of like the personal trainers of the finance world. 

When you work with a CERTIFIED FINANCIAL PLANNER® Professional, you are working with someone who has the knowledge and skills to help you reach your financial goals. 

Personal finance is, well, personal. So having someone in your corner who understands your situation may be just what you need to reach your financial potential. 

We talked all about this topic on episode 61 of The Canadian Money Roadmap podcast—check it out if you want to dive deeper. Or, read on here for 6 reasons you may want to work with a financial advisor and what to expect when you do. 

Before getting into all the benefits of working with a financial advisor, a quick caveat on the types of people you may encounter. There are a variety of credentials and roles that a financial advisor can hold, each slightly different. 

The rest of this article is, generally, talking about the benefits of working with someone who is a CFP professional or other financial advisor who looks at the macro picture of your financial situation instead of a siloed aspect of it (i.e., just taxes or investments). 

6 Benefits of Working with a Financial Advisor

The main and overarching benefit of working with a financial advisor is that they have specialized knowledge in the field plus the ability to tailor it to your specific situation. 

With the breadth of online resources, both good and bad, it’s possible to get objective financial information. What’s harder to do is cut through all the noise and understand what’s relevant to you and your situation. 

And that’s where a financial advisor comes in—they wade through all the information out there and make it relevant to you. 

Here are 6 benefits of working with a financial advisor and why you may want to do so.

1. Cut Through the Financial Noise

Between YouTube, articles, news stories, blogs, and podcasts—yep, even mine—there’s a lot of financial information out there. 

And it can get noisy. 

How do you know what’s accurate? What’s relevant? What should you pay attention to? 

With their expertise in the area, a financial advisor knows what to listen to and what to disregard. More than that, they know your situation and can tailor what’s relevant to you. In this way, they cut through the noise and help you focus on exactly what you need to. 

2. Prevent Bad Decision-Making

If you’ve been around The Canadian Money Roadmap podcast or any personal financial advice, you know that compounding is an important force. Compounding is what builds wealth quickly and grows your portfolio. 

But compounding works the other way, too. If you make some less-than-ideal financial decisions early in life, you’ll live with the consequences of it forever. Some may be small, but some can be significant. 

Examples of poor decisions may be mishandling debt repayment or not consolidating a line of credit at a lower interest rate. 

A financial advisor can help catch some of those potential bad decisions and help you avoid them. Because of their expertise and experience working with a wide variety of people, they’re well-positioned to catch any poor decision before it’s made. 

3. Be a Sober Second Thought for Couples

Disagreements over finances are one of the leading causes of break-ups and divorce. Money can be a sensitive topic! So, if you’re married or in a long-term partnership, a financial advisor can help mitigate some of these arguments by providing a sober second thought on your situation. 

Now, we’re not therapists and we can’t make the decision for you. But we can sit with couples and work through questions, challenges, or ideas together. 

If both people trust the financial advisor, they can have a productive conversation and get the advice they need instead of getting into a fight. 

This dynamic is also relevant when one spouse passes away before the other, which is common. The one who is still alive may have questions about their estate, how to manage debt, if they should keep working, or how to take care of their kids. 

These are all questions that a financial advisor can help with. Because they’ve known both you and your spouse, plus your financial history, they’re well-positioned to walk with you through this major life change. 

4. Give Practical and Objective Financial Advice

Some of the earlier benefits on this list are subjective—they may be important to some people more than others. 

But financial advisors can also provide practical and objective advice on what to do with your money because they understand the nuances and specific details that you may not. 

As you accumulate wealth, grow older, or have unexpected life events, finances get more complex. You may understand, generally, some of the things you need to do but are unsure about the order or details of it. 

A financial advisor can help you with things like developing a spending plan for retirement or being efficient with taxes in both the short and long term. 

5. Integrate Multiple Goals and Priorities

Most people have multiple goals and plans for their finances. They may want to buy a house, retire, help their children financially, sell a business, or go on lavish vacations… There are a lot of things to do with your money!

But what happens when some of these are “competing” with each other? Say, you want to have enough money to live in retirement while also helping your kids with their first home purchase. A financial advisor can help you identify the best way to achieve both things while lowering your tax burden and ensuring everything else is still on track. 

And this is relevant for younger people, too. You may have questions about investing, saving, budgeting, or paying off loans. Or, you may be getting your first job, first home, or first child—all of these impact your financial situation. 

A financial advisor can help wade through all your life events and ensure that the financial side of them is where you want it to be. 

6. Keep You Accountable

The last benefit to working with a financial planner is that they’re someone who can help keep you accountable to your financial goals. Just like a personal trainer can motivate you to keep working out, a financial advisor will help you stay on track and make decisions and changes that will benefit your situation. 

If you’ve been curious about whether working with a financial advisor would be beneficial to you or not, I hope this helped explain it a bit! 

Because we look at a holistic picture of your money, we can offer help to people in just about any financial situation. Our goal is to help you reach your personal financial goals, as simple as that. If you’re curious to hear more about working with a financial advisor, check out the full episode on The Canadian Money Roadmap podcast.

— 

Evan Neufeld is a CERTIFIED FINANCIAL PLANNER® professional in Saskatoon, Saskatchewan and offers both investing and fee-only financial planning services.

*Disclaimer: Any numbers or rates of returns are used for illustration purposes only and should not be taken as fact. Note that the information in this article is current to the time of writing but is not guaranteed as up-to-date past then.

This article and accompanying podcast do not constitute personal financial advice. Evan Neufeld is a CERTIFIED FINANCIAL PLANNER professional in Saskatoon, Saskatchewan, and provides this Canadian personal finance content for educational purposes to the public. You are welcome to contact Evan to receive personalized fee-only financial planning or investment portfolio management.