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Why Financial Advisor is Valuable For Teachers In 2024

Thinking of Booking a Financial Advisor?

Higher interest rates boost the cost of borrowing. The financial world can be daunting. Even in the most peaceful economic times, you face a confusing welter of rules and decisions surrounding retirement accounts, asset allocation, your retirement age, and Social Security claiming strategies.

If you’ve never worked with a financial advisor, you may wonder what one can really do for you, what the relationship is like, what financial decisions they can help with, and how you know you’ve found the right match. Here’s what to expect.

What Can an Advisor Do for Me?

As you make decisions in all areas of your financial life, an advisor can offer personalized guidance on how to avoid common pitfalls and reach your goals. Imagine, then, having a trusted ally who has seen what you’re going through many times before and has years of experience helping others like you navigate the choices that come with a complicated landscape. In other words, a financial advisor.

Important Reminders:

  • A financial advisor should do far more than pick investments.
  • An advisor can help you prioritize your financial goals, develop a plan to reach them, and adjust along the way.
  • A major life transition such as the birth of a child, purchase of a home, second marriage, or death of a parent may be a good time to seek advice from a professional.
  • When the markets are choppy, an advisor can help you manage your emotions and put current events in perspective.

When do You Need a Financial Advisor?

Not everyone needs a financial advisor, especially since it’s an additional cost. However, having extra help and advice can be paramount in reaching financial goals. Especially if you’re feeling stuck or unsure of how to get there. Here are three main reasons why you may need assistance.

why financial advisor for teachers

Developing a strategy

  • A financial advisor is someone who can help you hone in on your goals and map out a way to achieve them. These goals can be anything from starting to invest to buying real estate to saving for an emergency or retirement. Whether you have one main goal or many, a financial advisor is your guide in creating and achieving those goals.

Lack of experience

  • Whether you have complicated finances or you don’t know how certain things work, hiring a professional can help you grasp concepts you weren’t familiar with. Some people need extra assistance, and if you have the means, getting personalized help can make a big difference.

Life events

  • Graduating college, getting married, expanding your family, and starting a business are some major life events that might cause you to reevaluate your financial situation. A financial advisor can help you manage these life events while making sure you get or stay on track.

Keep This in Mind when Choosing a Financial Advisor

There is a financial advisor for every budget and financial situation. Here’s a look at the types of financial advisors and how to choose the right advisor for you.

Understand Standards of Practice

Not every financial professional will have your best interest at heart. It’s best to look for someone who clearly follows a fiduciary standard. This means they are legally obligated to act in your best interest, even if advice or recommendations include discontinuing services. You can ask them to show their standards of practice in writing. Some financial professionals are held to a suitability standard. This means they are free to advise and sell products as long as they are deemed suitable for the client’s risk tolerance or age. Do not feel silly asking about the code of ethics a financial professional adheres to (Consumer Financial Protection Bureau).

Understand How Financial Professionals Are Compensated

When you are paying to receive financial advice, it’s important to understand how the financial professional you are working with gets paid to help you.

Commission only

  • Commission-only financial professionals sell financial products such as investments or insurance and earn money from commissions on those products.
  • Fee-based financial professionals typically charge an up-front service fee for their work and a commission on trades or purchases they make on your behalf.

Fee-offset

  • Fee-offset financial professionals charge by the hour or annually. Fees can be reduced by any commissions earned.

Fee-only

  • Fee-only financial professionals charge by the hour for their services, do not earn a commission and do not sell financial products.
  • The more you understand about how a financial professional is paid, the better you can determine when there might be a conflict of interest. If you ever feel pressured or aren’t sure that the direction you’re headed is right for you, walk away.

Understand Financial Professional Certifications

Professional certifications and descriptions of financial professionals can help you decide which type you are looking for, depending on your goals and circumstances. Many of the qualifications for certification require tracking training hours before certification is granted. It is also important to understand how your financial professional acquires continuing education.

  • The chart also includes contact information to check the background of the financial professional you are considering. You should do your due diligence to research qualifications, even if the recommendation came from a trusted friend or family member.

Disclosure: This information is for educational purposes only and should not be construed as financial advice. Please consult with a qualified financial advisor before making any investment decisions.

bill wallace author teacher retirement plans

About Author

Bill Wallace blends his academic background in Literature with his ventures in International Business and finance. His professional journey took him across Europe, especially in Spain, where his passion for writing evolved. Since then, armed with his literary finesse and investment acumen, he has been crafting financial content for teachers worldwide. More about me.

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