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When to hire a financial professional

Sometimes you need an expert opinion

For many of us, the role of a financial professional is a mystery. Just hearing the term brings up all kinds of questions.

Questions like:

  • What does a financial professional do?
  • How much do they charge?
  • Do I make enough money to need one?
  • What are the advantages of hiring one? 

There are certain times in life when almost everyone could benefit by consulting with a financial professional. Usually, it’s when your financial situation changes — for example, you get a new job, a big bonus or an inheritance, when you get married or are planning to start a family. 

A financial professional is like a life coach for your money who can help you make the best decisions for your situation. But before you can determine whether you need one, you should have some clarity on the basics. 

What does a financial professional do? 

Financial professionals offer a wide variety of services.

Most provide personalized financial information and can help you with financial planning, investing, saving for retirement and estate planning. They can also offer solutions to help protect your family's finances and assets, like life insurance and long-term care insurance.

A good financial professional approaches your finances from a holistic standpoint. He or she listens to your goals and vision, analyzes financial resources and opportunities, and devises a roadmap to help you reach your destination.

They factor in things like earning potential, major expenses (like children’s college educations), investment return considerations, inflation, tax efficiencies, possible health care needs and long-term savings requirements. They consider “what-if” scenarios to identify vulnerabilities and conceives “what-then” plans to respond. 

Since life is unpredictable, it’s helpful to have a financial professional you can call to ask for advice. A financial professional can help you make major financial decisions throughout your life, so look for someone with whom you feel comfortable cultivating a long-term relationship.

How much do financial professionals charge? 

Generally, there are three ways financial professionals are compensated, depending on the situation:

  1. They may charge you directly with a flat fee or by the hour
  2. They may charge a certain percentage of the assets they manage for you
  3. They may receive commissions from the companies whose products they recommend (typically insurance or investment products) 

It’s hard to say what it costs to hire a financial professional, because fees can vary based on the complexity of your finances, where you live, and many other factors.

Don’t shy away from asking about cost; it’s appropriate — and expected — to question a prospective financial professional about fees and compensation methods. 

It’s important to make sure you understand the services you’re receiving. 

Typically, a financial professional can help manage your investments as well as perform other services while considering the many aspects of your life and the factors that affect you financially.

Be sure you understand the services a prospective financial professional is offering, as well as his or her background, education and experience. For good measure, talk to more than one candidate. 

Some financial professionals take the time to earn a professional designation or certification – you can recognize them by the initials after their names. Examples include Certified Financial Planner™ (CFP®); Chartered Financial Consultant (ChFC); and Chartered Financial Analyst (CFA).

Do I make enough money to need a financial professional? 

There are benefits to getting professional financial advice regardless of age or net worth. 

To younger adults, hopes of financing a home or wedding may seem impossible in the short-term, and goals of sending children to college or retiring early too distant to think about. A financial professional can help map out financial strategies to make both short- and long-term goals achievable. 

Similarly, a couple in their early 50s who see retirement on their horizon can benefit by a financial professional helping them set up a distribution strategy to ensure a steady cash flow in retirement, regardless of the state of the economy. 

But, it might not be inexpensive to hire a financial professional and some may even have a minimum net worth they require of their clients. You have nothing to lose by inquiring. If the consultation results in a suggestion that saves you thousands in the future, or increases your wealth, you might decide the price is worth it. 

What are the advantages of hiring a financial professional?

People find the advantages of hiring a financial professional can take many forms. 


For many people, the prospect of managing their financial futures is overwhelming. Some find it difficult to grasp financial concepts, others become paralyzed at the thought of making financial decisions. Hiring a financial professional to help guide them through the planning process is a huge relief. 


There are some people who are too busy to think about finances, or they simply don’t like to. An ongoing relationship with a financial professional can give them freedom to accomplish other things, while still knowing their financial health is in good hands. 


Even the smartest money managers could use a second opinion now and then. Some people discuss their long-term plans with a financial professional in case they’ve overlooked an opportunity or may be making a costly error. Consulting a financial professional can offer an increased sense of confidence. 


Money and personal goals can be emotional topics. A financial professional can offer an expert opinion and may be able to see that a certain goal is unrealistic, or an inherited asset is not worth keeping, regardless of its sentimental value. Having a financial professional looking over your situation can offer an advantageous reality check.

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DOFU 3-2023