Are You Too Broke to Ask for Financial Advice?
Nobody cares about your money as much as you, but that doesn’t necessarily mean you shouldn’t receive help managing it. Whether it’s how much money you’re currently spending or how much you’ll need for the future, we all have biases that work against our best interests. A financial advisor can provide a much-needed perspective. The trick is believing you have enough money to seek advice.
Nearly have of Americans think they need a significant nest egg to justify working with a financial advisor. According to a new survey from TIAA-CREF, 45% of respondents say they need at least $50,000 in savings to merit that meeting. Of those who have never received professional financial advice, 63% list “I don’t have enough money to invest” as a reason. Contrary to the adage of men not stopping to ask for directions, men are more likely to ask for financial advice and less likely to say they don’t have enough money to do so.
“Everyone can benefit from financial advice because we all have something we’re working toward — paying off student loans, purchasing a new home, or making sure our loved ones are taken care of when we’re gone,” said Kathie Andrade, EVP and President, Individual Advisory Services at TIAA-CREF, in a press release. “No matter where you are in your savings journey, you don’t have to go it alone. The sooner you engage an advisor, the more likely you are to meet your goals. And an advisor can help you stay on track and adjust when needed. Plan for the future you want.”
Receiving advice from a qualified, trusted financial advisor has several benefits. The survey also finds respondents who meet with an advisor are more confident in their retirement savings plan than those who have not (78% vs 43%). More importantly, they take action to better secure their financial future. In fact, 37% say they changed their asset allocation, 36% increased their savings amount, 32% monitored their savings more frequently, 29% decreased their spending, and 28% established a plan for paying off loans or managing debt.
“Getting financial advice often leads to positive actions — increasing the amount of retirement savings, establishing an emergency fund or developing a plan for paying off debt,” Andrade said. “It’s never too early — or too late, for that matter — to consult with an advisor and put a financial plan in place.”
While respondents indicate life events like receiving an inheritance, selling a home, losing household income or a loved one, or divorce may prompt them to seek financial advice, reaching an arbitrary nest-egg amount of $50,000 should not be included. A separate survey from GOBankingRates finds 62% of Americans have less than $1,000 in savings, with people age 35 to 54 the most likely to have a savings balance of $0. If you wait until you reach $50,000 or some other ill-conceived milestone, you could miss out on years and even decades of valuable financial advice.