do I need a financial planner

Do I Need A Financial Planner?

Financial planning has evolved over the years. Since I’ve entered the profession, technology has enabled planners to help more and more clients. The financial planning software has improved and reduced the amount of time it takes to gather financial data. Real-time account aggregation and encrypted “vaults” to store sensitive financial information are now a cornerstone of any planning practice. Today, planners are able to focus more on the qualitative side of our professions. Getting to understand our clients at a deeper level, what behaviors and habits drive their financial decision making, and helping them articulate goals. When determining whether you need a financial planner, you should consider these facets of our service in addition to being able to solve the quantitative, number-focused, or investment-related issues many people seek us out for. This article will aim to help you answer the question, do I need a financial planner?

Quantitative Decision Making

The majority of people who seek the help of a financial planner have some variation of issues related to their finances that are numerically related. Whether that’s paying down debt and the fastest way to do so, prioritizing free cash flow towards various goals, saving for a home downpayment, or maximizing employee benefits. All are important issues that would be addressed through the financial planning process.

If you’re in need of help, don’t have the time or interest in making these decisions, it would be a good time to schedule an appointment with a financial planner. While that may seem obvious, you may feel that you can’t afford a planner, are embarrassed by the situation you’re currently in, or are unsure we’d actually be able to help.

Yet, you may be surprised there are planners that charge a retainer or subscription fee with no account minimums. And regardless of the shape, you’re currently in, we get more satisfaction out of successfully helping clients build a better financial foundation and future than any embarrassment you might feel. It’s our job to help people! Lastly, no matter how savvy you may have been with your finances, an outside opinion always seems to find something that can be improved. Financial planners actually encourage each other to have a financial planner of their own for this very reason. There are biases that arise when planning for yourself.

Check, check, and check. When deciding whether to seek out financial advice, it typically starts with solving some sort of quantitative issue. However, financial planners help with more beyond solving the financial mathematical puzzles presented to them which we’ll dive into next.

Articulating Goals

The whole point of financial planning is to help clients articulate, track, and eventually realize their goals. Sure, investing and making money from investments is great, but the question that arises is what is the purpose of my money? What do you want to use the money for to accomplish, experience, or provide for in your life?

Some of these goals are pretty common among individuals or families. You want to eventually have enough money to become financially independent, to give your kids a quality education, and to eventually have a place to call home. Taking the proper steps on the quantitative side of financial planning can help you accomplish these.

However, some goals are not so easily “articulated”. It can be evident when having conversations with a spouse. One who may disagree on how much of an allowance should be given to their children, or one which may spend significantly more than the other.

Having a financial planner assist in these discussions can help spouses and individuals prioritize and articulate goals that are MOST meaningful to them. Once a clear depiction of goals has been outlined, it helps provide the peace of mind we seek when it comes to managing our finances.

Biases and Behaviors

A new field of study known as behavioral finance has emerged that helps planners understand how biases, behavior, and emotions all affect financial decision-making. First, let’s take a look at a few biases that affect our decision-making.

  1. Confirmation Bias: When seeking an opinion we inherently seek opinions that will support our original ideas. First impressions really do matter! In the case of investments, we’ll tend to seek information that supports our original “first impression” or idea rather than information that contradicts it. Look no further than political debates and media for evidence of confirmation bias.
  2. Recency Bias: Investors tend to act in a manner that would mirror the fashion industry. Whatever the hottest new thing on the block is, they pour their money into it. Yet we all know that past performance is no indication of future returns. Research has shown it’s near impossible to predict which asset class will be a top performer in any given year.

As financial planners, we have to be aware of these biases in order to avoid falling trap to them. As individual investors, it can be hard to maintain the awareness necessary to avoid them.

Secondly, behaviors around financial decision-making are ultimately what differentiates people who are successful with their finances and those who are not. If someones come to us with a lot of consumer debt, we’ll devise a way to pay off the debt. But we’d also need to address the behavior that got them in debt in the first place. Without addressing the behavior they’re likely to repeat poor financial decisions and find themselves in consumer debt once again.

Lastly, as the chart below shows, the average investor significantly underperforms their benchmark. What’s the cause of this? Investor behavior, and allowing emotions to dictate their financial decision-making. Selling and buying investments at the wrong time! It’s more important to participate in the market than to try to time it, as history has shown it’s near impossible.

do I need a financial planner


You may have done a great job outlining your goals and figuring out how much money you’ll need to accomplish them. Actually putting the plan in place and holding yourself accountable is another thing. It’s human nature to ease up when we have no one watching or encouraging us along. It’s no different when it comes to your finances. A financial planner can be your accountability partner when it comes to accomplishing your goals.

No more, “I’ll increase my 401(k) allocations next year, it won’t hurt to put it off”. No, it’s getting done this year and as a matter of fact today!

Peace of Mind

Lastly, and arguably the biggest benefit you can get from working with a financial planner is peace of mind. If you’re the type of person who consistently worries about their finances, it can be a huge relief to have a professional put a plan in place that makes sense and puts you on track towards your goals. Personal finance can be hectic and confusing. It’s no wonder that companies are starting to implement more financial wellness programs as part of their benefits. They lose productivity from employees who are stressed about their finances!

Peace of mind with your finances, in turn, leads to a more meaningful and stress-free lifestyle!

If you’re still on the fence about whether you need a financial planner, don’t hesitate to schedule a free consultation today. Regardless of whether we work together, we’re happy to point you in the right direction as best we can.

Levi Sanchez, CFP®, CPWA®, CEPA®, BFA™
Levi Sanchez, CFP®, CPWA®, CEPA®, BFA™
Levi Sanchez is a CERTIFIED FINANCIAL PLANNER™, CERTIFIED PRIVATE WEALTH ADVISOR®, CERTIFIED EXIT PLANNING ADVISOR®, BEHAVIORAL FINANCIAL ADVISOR™ designee and Founder of Millennial Wealth, a fee-only financial planning firm for young professionals and tech industry employees. Levi’s been quoted in the New York Times, Business Insider, Forbes, and is a frequent contributor to Investopedia. He is an avid sports fan, personal finance and investing geek, and enjoys a great TV show or movie. His mission is to help educate his generation about better money habits and provide financial planning services to those who want to start planning for their future today!

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