Using Advisors: Start Early

Congratulations, recent 2014 graduates. You now embark on an exciting new chapter of your life. You are eager to start a career and work toward achieving all your goals. But where do you begin? How do you make the best out of your first paycheck, and others to come, to finance for your ambitions and dreams in life? Answer: Get a good financial advisor.

Just like when you want to get in better shape, you go to a trainer. When you don’t know what to do with your finances, you go to a financial advisor, a person who guides you through all financial decisions, big and small, now and in the future.

It is never too soon to start drawing up your financial blueprint, but the task can be intimidating. How many people have the will to analyze their spending, sort through regulations, and compare investment opportunities for the best options? You are young and life is long. You can easily postpone budgeting for your life.

But sooner or later, there comes the time when you face huge expenses you can’t cover with your monthly paycheck. Where do you find the money when, after a few years out of school, you start thinking about settling down, getting married or buying your first house, while student loans still weighing on your shoulders? Get a firm grip on your financial future as soon as you can with the help of a financial advisor.

Choosing your advisor. Your finance is very personal and may not be something you want to discuss with just anyone. You should build a long-term relationship with an advisor you feel comfortable with, so that you are both on the same page with your financial history and needs.

To begin with, you can ask your parents if the advisors they have are good choices. If you don’t want to work with your parents’ advisors, you can consider someone in the same office, an associate on staff, for example. If you work with an advisor who knows your parents, he or she understand your family relationships better, and can coordinate financial planning when it makes sense.

Find out what services the advisors provide, and how they get paid. Advisors may have different titles — planner, advisor and consultant (just to name a few), but not everyone provides the same level of service. Some advisors get paid based on the products they sell you.

Some advisors have their own business with a few employees, while others may have no support staff. It is important to understand the dynamics of your advisor’s team, and what your back-up plan is, should an emergency arise. What do you do, for instance, if you lose your job? Do you have a sufficient rainy-day fund set aside to tide you over?

Online advisors. One of the new trends in the financial services industry is getting online advisors or robo-advisors. This is a low-cost option, but their services may be limited and lacking in the personal touch.

Robo-advisors don’t get to really know you and your views on money. Sometimes, they only provide tools for investing. They are not able to work with you on big life decisions, like whether to buy a home or when to have a child.

More importantly, talking to an advisor in person help reduce anxiety. It is difficult to take emotions out of your investing decisions. When it comes to investing, having a plan and sticking with it reaps more success than making changes based on short-term fluctuations. When the stock market goes down, staying calm and disciplined is hard. This is when face-to-face advisors come to be useful.

When you are in this very beginning of your financial journey, finding a good advisor is the most important decision you can make. Do it sooner rather than later. Make sure to do your research so that you can find an advisor who understands your needs and aspirations, someone you are comfortable with for the long haul, and someone who is right for you.

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Julie Nichols is a principal and chief financial officer at Wipfli Hewins in Milwaukee.

The information presented herein is standard information and intended only as a broad discussion of generally available incapacity-planning tools that a reader might consider discussing in detail with their attorney or other qualified professional advisor(s). None of the information contained herein is specific to the laws, rules or regulations of any state or other governing body, and as such cannot be construed as, or used as a substitute for, legal advice. Further, none of the information contained herein has been written or personalized for any individual, and the information may not be applicable or beneficial to anyone’s personal situation(s). The documents and processes identified herein can be complicated, and in many cases require the assistance of a qualified attorney to execute effectively. To the extent that you have questions about or wish to make use of any of the tools or processes identified herein, you are encouraged to seek the advice of your attorney. You assume full responsibility for your use of the general information contained herein and acknowledge and agree that by using the information contained herein Hewins Financial Advisors, LLC, its affiliates, agents and/or employees shall have no responsibility or liability for any claim, damage or loss resulting from your use of such information. 

Hewins Financial Advisors, LLC and Wipfli Hewins Investment Advisors, LLC (together referred to as “Hewins”) are independent, fee-only 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. Hewins is a proud affiliate of Wipfli LLP. A copy of Hewins’ current ADV Part 2A discussing our investment advisory and financial planning services and fees is available for review upon request.

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