In recent years, I've seen several articles about why hiring a financial planner could be beneficial, even for those in the financial planning profession.
My gut reaction to these articles was, that's crazy talk. I love eating, breathing and dreaming about personal finance and no one cares about my finances more than me. Why would I shell out money on stuff I can do myself?
Recently, though, I had a change of heart. Here's why my wife and I decided to hire a financial planner.
Our Reasons For Hiring A Financial Planner
#1: To Receive Unbiased Third-Party Insight
All of us are influenced, to some extent, by our money scripts — unconscious core beliefs about money that we've been developing since childhood. How we were raised and our relationship with money may influence, rightly or wrongly, our financial decisions. By working with an unbiased third party, my wife and I could ensure that past programming was not leading us to make bad decisions.
#2: To Level The Playing Field With My Wife
I typically take charge of the family finances because of my interest and knowledge of the subject area. As a result, I'm often the one in our relationship who comes up with new ideas and strategies for our finances. While I run every major financial decision by my wife, she may not feel comfortable challenging or rejecting any of the strategies because she's not as fluent in the topic.
Working with a financial planner allows both of us to be clients. For my wife, that means feeling more included in the process; and for me, that means, taking some of the pressure off of me while also gaining confirmation that our strategies are appropriate for our goals.
#3: To Avoid Blind Spots
While I am a financial planner, financial planning covers a variety of topic areas, including saving money, getting out of debt, managing human capital, developing investment strategies, and identifying insurance and estate planning needs, among others. I possess more knowledge and experience in some areas than others. Working with another planner ensures I'm not overlooking an important detail just because it's not my strength.
#4: To Conduct Competitive Research
Hiring my own financial planner gave me a firsthand look at how another planner does business and manages clients. In particular, I gained a sense of different approaches, timelines, styles and frequency of interaction, and even the type of language that can be used in communications. The experience allowed me to evaluate whether I could improve my existing processes in concrete ways.
How We Chose A Financial Planner
We went through the same process for choosing a financial planner that I recommend to all of my readers, prospective clients, friends, and family (as outlined in this prior article). Namely, we considered an advisor's education and experience, certifications, fees and conflicts of interest, and desired working relationship.
We entered the search process with specific criteria.
From an education, experience, and certification perspective, we were looking for someone able to take a holistic look at our financial situation, which required expertise in general financial planning, taxes, and investments.
Being a Boglehead, I also wanted to find a planner who believed in a similar investment philosophy. Specifically, my preferred approach focuses on capturing the market return through low-cost index funds and minimizing fees and taxes. Finally, because my wife and I were primarily looking for a second set of eyes, we wanted to find an advisor who offered a one-time project plan and charged flat fees rather than other service offerings, such as an ongoing retainer or an assets under management fee.
Based on these factors, we ultimately chose to work with Laminar Wealth — which checked all the boxes we were looking for.
Overall, we were extremely pleased with the process. Hiring a financial planner helped confirm some of our instincts, provided us with suggestions we hadn't considered previously, and allowed me to see into another planner's processes. I came away with ideas on how to improve my personal financial situation, as well as my business. Talk about bang for the buck!