When Your Savings Reaches This Number, It's Time To Hire A Financial Planner

Managing tricky financial math is not for the faint of heart. The reality of modern living involves thinking about the causes of inflation and its lasting effects, building a robust budget that can outlast seemingly constant fiscal challenges, and doing this all while saving for retirement. It's often difficult just to stay ahead of the constant onslaught of bills and necessary expenses. Even those who earn high salaries can find themselves struggling with key financial milestones like setting money aside in a fully-stocked emergency fund. However, savers who prioritize their distant future are likely to build a sizeable nest egg.

With that said, people who build up a decent investment portfolio, and savings reserve, will find that their finances don't get any less complicated for the effort. In fact, planning your tax liability, keeping the right amount of cash in liquid assets, and protecting your future against lifestyle creep and other threats only gets more challenging as you start to accumulate more capital. As you continue your financial journey, it might even make sense to sit down with a financial planner to understand where your strengths and challenges really lie. Some experts suggest doing this when you reach a savings figure of $50,000. At that level, there is a lot to get excited about, but still more that might challenge you and your future plans. 

Financial planners can be a valuable point of assistance. For savers who might not know exactly what they're doing, some extra firepower can be most welcome. For example, a recently divorced person with a sizeable savings portfolio but less-than-stellar investment savvy. If you find yourself with $50,000 or more sitting in your portfolio without the know-how to continue building its value, you may be teetering on the edge of retirement financing calamity. Enlisting professional help can be an ideal means of stabilizing this nest egg, and even helping it grow. An advisor will be able to tailor your ongoing investment and rebalancing strategies to your specific goals and priorities.

Another example of those who might want to consider additional financial support are those who are swimming in unexpected medical bills or other sudden expenses, but have built a decent savings up along the way. A financial advisor can provide important guidance on how to continue managing investments amid other challenging scenarios. For one thing, it's possible to borrow from your 401(k). However, this action can come with significant financial consequences. Understanding if your new circumstances warrant that drastic action is tough, which is where the expertise of a financial planner can come in. Their advice might be the right medicine to put these decisions into perspective.

After hitting the $50,000 savings threshold, it could be a good idea to sit down with a professional to discuss strategic next steps. However, it's important to keep a central feature of the financial industry in mind. Tailored, individual support for you and your portfolio, plans, and needs ultimately costs money. Whether it comes to your retirement investments or daily cash flow, if you don't require additional help in planning your approach to money management, paying for it can be a waste. This is particularly important when it comes to retirement investments. Paying a financial planner to manage your accounts can come with a bill that might equal 1% to 2% of your entire portfolio's value. With that said, that may be a small price to pay for active portfolio management that directly serves your needs.

Another potential approach involves hiring an advisor to work with you on specific goals that may or may not include portfolio management. Financial advisors working by appointment can charge between $200 and $500 per hour. But that sit-down can be invaluable to your financial management approach for years to come. An advisor can help you explore strategies to better protect your retirement assets in light of other fiscal elements in your life, such as credit card debts, mortgage repayment plans, and even unexpected hiccups like an extra semester at college for one of your children or a sudden need to replace your car.