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When you’re rich. 😁 More generally, when you have more money than time.
If you don’t have the interest, or won’t make the time, to understand the complexities of FP, it makes sense to find a good, independent FA. I’ve seen dramatically how having a good plan, and following it, is so superior to no plan. Also, if you have complex issues, like disabled children, finding an expert is critical. I know an elder law attorney who has helped a number of friends navigate the complex Medicaid rules and help them with sick parents.
I moved a portion of my assets to trust company once I got to financial independence and the complexity of tax planning, asset allocation and wealth transference strategies was more than I could manage.
Time and complexity. I found it super easy to effectively manage my portfolio in my 20s – maxing out tax-advantaged accounts and doing small tax-loss harvesting. Index funds. Brokerage account, HSA. Easy peasy.
As I’ve gotten into my 30s and have my own LLC, there are some complex issues. I should have invested a little time with a CPA/tax advisor a year or two ago. No big hiccups, but there could have been some opportunities to save more.
I now find myself seeing the value of the behavioral benefits of working with an advisor. Being more hands-off now that my portfolio has grown is probably a good thing to keep my emotions out of play. So I should high-tail it to a CFP, but my controlling nature/bias is stopping me. For now.
When you have neither the time nor the interest in doing it yourself.
I think “hiring a financial advisor” is a pretty open-ended term. Wealth manager, investment manager, financial planner, life insurance advisor all can serve a purpose at different life stages. Then two important questions need to be asked: do you trust them to do right for you as a fiducuary and how much should you pay.