Six Times You Should Hire a Financial Planner (and Three Times You Shouldn’t)

Financial planners can help you navigate the simple and complex financial situations that life has in store for you. Whether you’re responding to a major event or just getting control of your financial growth, a financial planner might be the right fit. Knowing when to reach out for help (and when not to) can help you get the best results from these financial professionals.

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In this article

    What is a financial planner?

    Financial planners are industry professionals who help individuals and companies plan for their financial futures. These planners can help you manage an investment portfolio, buy stock and other investments, advise on investments, set up a plan to reach a financial goal or plan for retirement.

    The main reason people enlist the help of financial planners is to get an experienced opinion and guidance for their financial plans. While financial planners are not required to hold any special certifications, many of them do and are highly trained and experienced in the field.

    The difference between a financial planner and financial advisor

    While many people use the terms financial planner and financial advisor interchangeably, there are actually differences between the two. The term financial advisor is a broad, overarching term that encompasses anyone who helps to manage matters of money. This might be investments, real estate, major purchases, life insurance or even tax planning. Financial advisors are required to hold a special license to work with the public (Series 65).

    Financial planners are people who help individuals and businesses plan for their financial future. Unlike financial advisors, financial planners are not required by law to hold any special certifications. That being said, many of them do hold licenses, special certifications and have attended special schooling to better serve their clients. Additionally, with certain areas of advising, there are some legal requirements they must uphold.

    At times, both financial advisors and financial planners may do the same type of work.

    Six times you should hire a financial planner

    You’re free to hire a financial planner at any point in time. But there are some instances where it might be more important to enlist the help of a financial planning expert.

    1. You’re at, or close to, retirement age.

    Some of your biggest money questions may arise when you’re close to retirement. Do I have enough money? What are my options? How can I save more? Financial planners are trained to help individuals plan for and navigate the unique challenges of retirement.

    2. You got a significant raise.

    When you’ve got more money coming in all of a sudden, it may be time to put together a plan. While you can use that money to raise your short-term quality of life, you could look into using it to increase your wealth and future financial position. Financial planners can help you decide where to invest, what options you have and what might be the best way to increase your overall wealth.

    3. You received an inheritance

    One of the most important times to seek the help of a financial professional is when you receive an inheritance. You’ll most likely have questions about where to invest, how to take care of your passed family member’s final financial wishes and how the newfound money changes your life moving forward. Financial planners can answer all of these questions.

    4. You’re going through a divorce.

    While divorces can take a major toll on your emotional health, they can also take a major toll on your financial help because of shared finances. Who gets what? How do I protect myself? Where should I reallocate my assets? All of these questions and concerns can be put to rest with the helpful advice of a financial professional.

    5. You’ve had a major life event happen.

    Any other major life event that happens might require the help of a financial planner. If you change jobs, downsize dramatically, find a new source of income, have a baby, sell a business or anything else, you should have a plan. A financial planner can walk you through all of your options and help you to make the most well-informed decision.

    6. You’re ready to take control of your financial situation.

    You don’t have to have a major life event happen to get the desire to take control of your current and future financial situation. If you’re ready to make a new plan, reach out to a financial planner. Additionally, if you have an existing plan that you want to stress-test, a good financial planner can help you identify and plug any leaks for optimal performance.

    You don’t need a financial planner if:

    1. You live paycheck to paycheck.

    While you still need a financial plan, you probably don’t need the help of a financial planner. Instead, you should look into simple practices like budgeting, saving and cost-cutting to slowly get ahead. Once you’ve made up some ground with the basics, you can look into getting the help to take the next step.

    2. You’re deep in debt.

    Financial planners mainly focus on helping people grow wealth. Additionally, financial planners are not free, which is not ideal for someone in debt. What you need instead is a credit counselor or financial professional who specializes in getting people out of debt. Once you’re out of debt, you can start focusing on growing for the future.

    3. You know what you’re doing.

    Financial planners are designed for people that need help making financial decisions. If you’re already an expert in the field, you might not want to pay for the help of a professional with the same knowledge base. The only exceptions to this might be if you’re short on time, want a second set of eyes or you want to stress-test your existing plan.

    Is a financial planner right for me?

    Chances are if you know you need to make some major financial decisions, but you don’t know what to do, you need a financial planner. When you need help with your health, you go to the doctor. When you need help with your financial health, why not see a professional as well? While each situation is unique, getting financial advice earlier in the decision-making process is almost always better.

    Financial planner FAQs

    Financial planners can help walk you through tough financial decisions step by step. A quality, well-trained financial planner can break down complex situations in ways you may be able to better understand. Additionally, financial planners can lay out all of your options and help you to make the best fiscally responsible decision moving forward.

    Financial planners may be able to help create an investment portfolio with little to no risk. Depending on your situation, though, they may recommend an investment strategy that does carry some level of risk. In these situations, financial planners won’t be able to guarantee a profit, as they can’t control the fluctuations of the market.

    No. Financial planners come in all different shapes and sizes, and it’s critical you take the time to shop for the planner that best fits your needs. Some of the most significant ways financial planners differ include experience, certifications, licenses, time available, account minimums and costs and fees.

    So what do you think? Would you consider hiring a financial planner? Why or why not? Let us know in the comments.

    Margaret Wack

    Contributing Writer

    Margaret Wack writes about personal finance, health, wellness, arts and culture, among other topics.

    Reviewed by

    • Courtney Mihocik
      Courtney Mihocik
      Loans Editor

      Courtney Mihocik is an editor at The Simple Dollar who specializes in personal loans, student loans, auto loans, and debt consolidation loans. She is a former writer and contributing editor to,, and elsewhere.