Should you work with a financial professional or a handyman?

A few weeks ago, I saw an Instagram post from a friend of mine with his face buried in his hands and a pair of car keys with the hashtag #failmomentoftheday. Apparently he tried to program a new key for his wife’s car and managed to deprogram both keys. The result was to hire a tow truck to haul the car to the dealership – which he was trying to avoid in the first place.

I spoke to him afterwards and he mentioned that he was convinced he was going the DIY route after watching YouTube videos. If alcohol is liquid courage, YouTube is digital courage. My own failures after a bit of digital courage include various attempts to fix my car and lawn mower, burnt pieces of meat offered to the Grill Gods, and a Craigslist furniture repairman who now resides in my attic.

I can now laugh at these DIY disasters. However, sometimes doing it yourself might not be a laughing matter. When does the cost of a rookie mistake outweigh the cost of having someone else do it?

When does it make sense to hire a financial advisor to guide you through your nest egg decisions? Should you try to write your own will? Can you find the best mortgage and insurance rates yourself? Here are some thoughts on the value of hiring a professional:

When to call a financial advisor?

The value of a financial advisor lies in their ability to work with you to build a portfolio that you can tolerate during inevitable market fluctuations. Time in the market usually beats the pace of the market and a good advisor can help keep you on track in this area. Plus, once your nest egg is in place, a good financial advisor will help you design a strategy that allows you to earn income.

If you want to invest outside of your employer’s pension plan and retirement is more than 10 years away, DIY investing may make sense. There are many low cost investment options to consider or robot advisor options that can function as a “light advisor”. If you are just not comfortable going it alone or are nearing your investment goal, it may be time to speak with an investment advisor.

Financial advisor is an umbrella term, you may want to search for someone of good repute and with specific training for your needs. My colleague Erik Carter wrote a blog post that explains exactly what to look for in a trusted advisor. Doing due diligence is so important that the CEO of Financial Finesse wrote a book about it: What Your Financial Advisor Isn’t Telling You: The Ten Essential Truths You Need To Know About Your Money.

When do you need a professional to help you plan your estate?

An estate plan can show where your assets will go, such as a car, house, business, savings, etc. in the event of death. Our own mortality is not the most pleasant subject, but it is one that we all deal with. A well-thought-out estate plan can make it much easier for those we leave behind.

If you have a blended family or assets in multiple states, professional assistance is especially helpful. If you think a trust might be necessary, you will most likely need a lawyer to set one up. If you are looking for a lawyer who practices estate planning law in your area, your local estate planning board is a great resource. Also consider checking to see if your employer offers legal aid benefits.

Do you think your situation does not deserve to hire a lawyer? Then it may be a good idea to find a tool to help you set up a will. Websites like nolo.com offer wills that comply with the laws of your state.

When to call a tax expert

If you don’t claim deductions beyond your home and kids, using tax software will usually do a good job of filing your taxes at minimal cost. There are times when software may not be the right solution. If you own a small business, earn income from rental property, live or work in multiple states or countries, or if you are settling an estate, hiring a Chartered Accountant (CPA) or agent registered (EA) can be very careful. investment.

If you are going to pay someone to help you, it would be best to hire a CPA, EA, or lawyer because they can speak to the IRS on your behalf if you ever get audited. Not only can these professionals help you file your taxes, they can also give you advice on how to run your business to get the most out of the tax rules. The IRS actually offers a site to find qualified professionals in your area.

When should you work with a mortgage or insurance broker?

From my personal experience, I can suggest that the “simpler” your situation, the more time and money you can save online, but the more complex your situation, the better off you are with a seasoned professional. In the case of life, disability and long-term care insurance, if you have a condition that could be considered negative or rare, it may be beneficial to speak to an insurance broker. They can direct you to the right companies that will insure you despite this condition. In the case of a mortgage loan, if you have any cases that are worth explaining on your credit report, it may be beneficial to hire a mortgage broker and find the bank or mortgage company. who would view your situation more favorably. In the case of both the insurance broker and the mortgage broker, they can often find quotes at no additional cost to you.

Knowing whether to hire someone or tinker with can be tricky. Hope this gives you an idea of ​​when to call someone. Otherwise, you risk experiencing your own #failmomentoftheday.


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