Ten Reasons you should work with a Financial Planner

What is a Financial Planner?

A financial planner is a professional that works with clients to create financial plans. A good financial plan encompasses your entire financial situation, including your cash flow, tax strategy, risk management, estate plan, and – yes – your investment portfolio. Financial Plans are typically goal-based, and personalized according to your short-, medium-, and long-term objectives. Financial planners take all the facets of your financial life into account to create a comprehensive plan that is intended to reach your financial goals.

Why Should I Work with a Financial Planner?

There are many reasons to hire a professional financial planner, like those at Affiance Financial, but our top ten reasons are outlined below.

1. Providing Comprehensive Planning for Every Life Stage

Each stage of life comes with challenges and opportunities; your financial plan must evolve with your goals, family, and income. For example, career growth often occurs in early adulthood, and clients may need to focus on paying off debts while beginning to invest. As clients transition to marriage and family planning, their priorities might change to cash flow management, risk management, and estate planning. They may have goals to purchase a home or start saving for their children’s education. As clients near retirement, financial planners must shift their strategies to maximize saving and reduce taxes. Once clients reach retirement, financial planners must pivot once more, to concentrate on spending rather than saving, and continuously monitor the plan to ensure it remains viable.

At every stage of life, financial planners meet regularly with clients to help ensure they are on the right path. They estimate expenses, reorganize cash flow, make tax recommendations, and adapt investment strategies for evolving goals. By staying connected with their clients, financial planners can identify new opportunities in each life stage, adjusting the plan in real time. And they can identify potential pitfalls, before it becomes too late to address them.

2. Maximizing Your Growth Potential

Do you have a large amount of cash in the bank earning minimal interest? Did you receive an inheritance you are not sure what to do with? Do you have a variety of 401(k)s from past jobs? Too often, people miss these opportunities to put their money to work for them. Financial planners are trained, and often certified, to help you weigh your options and make strategic decisions that will maximize your growth potential. Financial planners make recommendations for where and how to invest your cash to maximize growth while minimizing lifetime taxes. They serve as accountability partners, helping you make decisions that align your actions with your goals. And these professionals have tools, systems, and teams in place to provide ongoing monitoring and support. A crucial piece that many DIY investors lack.

You work hard for your money. A financial planner can help make sure your money is working for you

3. Simplifying Complex Financial Decisions

Financial planners can help simplify decision-making for clients overwhelmed by investment choices and financial jargon.

Investing in the stock market can be a powerful tool for building wealth, but it can often feel intimidating, overwhelming, and downright scary. Through their training and experience, financial planners understand the options available to you and can explain how they affect you and your loved ones. They can work with you to select and manage investment strategies that align with your goals.

Financial planners can also help with emotional financial decisions. They can serve as an educational resource and support system during volatile market environments. By helping provide historical context and explaining common behavioral tendencies, financial planners can help take emotion out of the equation to help you make sound decisions, even during difficult times.

4. Keeping you on Track with Long-Term Goals

When retirement is still years, even DECADES away, it is easy to lose track of your long-term goals in the hustle and bustle of day-to-day life. But working with a professional financial planner can help. Part of working with a financial planner includes meeting regularly to ensure that your financial situation (your income and essential spending), actions (your discretionary spending), and goals remain aligned. If any of these have changed, which is common as your life evolves, your financial planner will adjust your plan accordingly.

Two common pitfalls that often distract from long-term goals are lifestyle creep and emotional investing. Lifestyle creep is when your spending increases with your income. Instead of putting additional income to work toward your long-term goals, you spend it on a higher standard of living. Financial planners can help their clients avoid lifestyle creep by keeping long-term goals at the forefront of strategic decisions and making saving and investment recommendations that are meant to pay off in the future.

Emotional investing can be dangerous. It is easy to focus on the hot stocks or investment fads, but this often leads to taking on more risk in your investment portfolio than necessary. Another type of emotional investing is taking on too little risk, due to fear of market volatility. Or worse yet, panic selling when stock prices are falling. Financial planners can help avoid emotional investing by providing discipline and structure.

5. Optimizing Your Tax Strategy

Accountants file taxes. Financial planners provide strategic tax planning. A financial planner can help you optimize your tax strategy by identifying opportunities to minimize tax liability. This includes strategic investment placement, effectively utilizing tax-advantaged accounts and deductions, and planning for major taxable events like inheritances or stock option exercises.

Protecting your investments from unnecessary taxes is a key component to long-term financial success. Strategies can reduce, defer, or eliminate investment taxes, helping ensure more money stays in your pocket. Financial advisors stay current on tax legislation, adjusting your strategy as tax laws change.

6. Protecting Your Wealth with Risk Management

Financial planners can help you protect your wealth through risk management. Insurance is a common risk management strategy, but not a one-size-fits-all approach.

Part of a financial planner’s role is evaluating and addressing financial risks through different insurance strategies. From property and casualty insurance to disability insurance, to life insurance, there are many options to consider. And within these, there are additional choices to make – term vs. whole, short-term vs. long-term, privately-owned vs. employer-offered. Knowing which options make the most sense for you is crucial.

Risk management isn’t only in the form of insurance policies. A financial advisor can also help ensure adequate protection against unforeseen setbacks by ensuring you have adequate cash available in an emergency fund or appropriate liquid investment option. And, a financial planner will evaluate the risk associated with your investments, making recommendations for proper diversification and asset allocation based on your risk tolerance, risk capacity, and time horizon.

7. Planning for Retirement and Preserving Wealth

The transition to retirement – from earning a regular income to living off your savings – is a significant, and for most, once-in-a-lifetime, event. A financial planner can help you create a unique, sustainable retirement income strategy that will allow you to live with confidence well beyond your income-earning years.

Various types of retirement income can be factored into your financial plan; most typically cover only a portion of retirees’ expenses. These include Social Security, a pension benefit plan, or an employer sponsored retirement savings plan, such as a 401(k) plan. Additional options include annuities and other investment accounts.

Financial planners can examine which types of retirement income apply to you, and craft a retirement income strategy to help you get the most out of those income sources.

During retirement, you are typically spending more than you are saving. So, it is essential to be strategic about withdrawals from retirement accounts.

One common withdrawal strategy is to make proportional withdrawals, where you withdraw from all accounts despite their taxability status, proportional to the overall savings. Another approach is to use the taxable accounts first. A financial planner will help determine the best solution for you.

8. Creating a Legacy Through Estate Planning

A financial planner’s role extends beyond the lives of their clients. Financial planners help their clients create lasting legacies through estate planning. Wills, trusts, health care directives and beneficiary designations are crucial to that process. Each addresses a different aspect of asset distribution and helps ensures that your wishes are carried out.

Financial Planners support their clients’ legacy desires by minimizing estate taxes and ensuring assets are distributed as intended. Strategies that can reduce estate taxes include lifetime giving, irrevocable trusts, and structured ownership of family businesses. Your financial planner can walk you through your options to choose the right ones for you.

9. Providing Accountability and Peace of Mind

Having a financial planner doesn’t just help your finances, it can help your state of mind. A financial planner provides accountability by helping clients stay disciplined and focused on their financial goals. They do this by guiding you to adopt proactive strategies, like automating savings and portfolio rebalancing. They also provide accountability by regularly checking in on your progress toward your goals to ensure that you remain on track.

Working with a financial planner can provide peace of mind to many clients during market downturns or economic uncertainty. While market volatility may cause some investors to panic, financial planners can help you stay the course by offering insight based on their professional education and experience. A financial planner can also provide comfort by reminding you of your established risk management plan. Having a trusted professional to turn to during uncertain times is invaluable.

10. Saving Time and Reducing Stress

Career, relationships, family, and health are just some of life’s worries, but the biggest culprit – finances. According to Schwab, financial concerns are the top of stressors among 18 to 44-year-olds. Two-thirds of the group reported feeling "consumed" by their worries about money. Nearly 47% of those surveyed said they wished they had someone to help manage their stress, yet 36% don't know where to start.

Working with a financial planner can take the burden of day-to-day financial worries off your plate. Financial planners simplify and streamline the process, making financial management much more efficient. A financial decision that would take you months to research and execute can be presented to you, agreed on, and implemented the same day when working with a financial planner. When you act on your own, it’s all too easy to neglect tax planning, make an emotional investment choice, or ignore certain details, such as proper beneficiary designations. A financial planner can help you avoid these potentially costly mistakes. By delegating financial planning tasks to a professional, you can free up your time and energy other important matters.

Key Takeaways

Comprehensive financial planning is a customized process. While some parts are universal – almost all clients have a goal to retire at some point – most are as unique as the individual clients themselves. Whether you are looking to maximize your growth, minimize your taxes, save time, or gain peace of mind, there are many reasons to benefit from working with a financial planner.

What Should I do Next?

Regardless of your financial situation, professional guidance will provide clarity on what steps you should take to secure your financial success. Don’t make the mistake of waiting; reach out to an Affiance financial planner today.

SCHEDULE A 30 MINUTE WELCOME CALL

Advisory services offered through Affiance Financial, a Registered Investment Adviser. Securities and advisory services offered by Registered Representatives and Investment Advisor Representatives through Private Client Services. Member FINRA, SIPC. Affiance Financial and Private Client Services are unaffiliated entities. Affiance Financial only conducts business in states where it is properly registered or is excluded from registration requirements. Registration as an investment adviser is not an endorsement of the firm by securities regulators and does not mean the adviser has achieved a specific level of skill or ability.

Neither firm is engaged in the practice of law or accounting. You should always consult an attorney or tax professional regarding your specific legal or tax situation.

All investment strategies have the potential for profit or loss. There are no assurances that a client’s portfolio will match or outperform any particular benchmark.

Sources:

Achieving Success by Working Together

Top Ten Reasons to Work with a Financial Planner in 2025