Managing your finances is not easy. If it were simple to do, there would not be so many people struggling to make ends meet. People would have enough money in their savings to deal with emergencies and they would be able to plan for their retirement so they would not have to rely on social security for their income. It is okay to seek help managing your finances and there are many professionals who will provide you with help in this area. Before you turn over your financial future to a professional, however, make sure you understand what they will do and how they will do it.

The type of help you will need from a financial professional will depend upon your age, the amount of money you have, and your financial needs. There is no right age to begin working with a professional. The financial advice for young people may not be the same as someone who is nearing retirement age, but it is just as important. The help a financial advisor gives will depend on your stage in life. They might offer you good advice and bad advice.

At an Early Age

Good Advice: At this stage in life, you may have graduated college with a bunch of student loans. You may have gotten a credit card that you used during college. Now that you have a job, you need to come up with a plan to pay back your debt. That means a financial advisor should help you order credit reports so you can see what you owe and what your credit score is. They can help you come up with a plan to improve your credit so you can take advantage of all of the things that come with good credit.

It is also time to start planning for retirement. If you have a job that offers a 401(k) plan, it is best to take advantage of it. The more you save at an early age, the less you have to save later.

Bad Advice: Some advisors will say that you need to save 10% of your income for emergencies and retirement as soon as you start working. This is not always the case. The amount you need will depend on many factors and may be different for everyone. A financial advisor who uses the 10% for everyone may be giving bad money advice.

Middle Age

Good Advice: This time of life is often the most financially challenging. This is the time when you have the most financial responsibilities, such as a house and family. Despite all of the burdens you face financially, a good financial advisor will tell you that you still need to save money. The savings will help you pay for the expenses that will keep coming up. The amount you save at this stage is often higher than it was when you are young and single and requires better financial management.

Your financial advisor should also ensure that you are checking your credit score on a regular basis. It will help to be aware of identity theft and help you maintain good credit.

Bad Advice: You can borrow money from your 401(k). This is one of the biggest credit mistakes you can make. You have to pay penalties and income tax on money you withdraw from a 401(k). The cost of borrowing money in this way is often much higher than other methods. Look to other sources for the money you need to borrow.


Good Advice: Once you retire the goal of your financial advisor changes. Now the focus is on having enough money to enjoy life the way you want. If you have saved enough, you now need to make sure it is invested wisely and that it will last you until you die. The average life span for a woman is 81 years old and for men is 76 years old. Some people live longer and some die sooner. A good plan will always expect you to live longer.

Bad Advice: Many financial advisors recommend buying insurance policies at this age. Life insurance, burial insurance, and long-term care insurance can protect you in the future, but they are not always worth the money you pay. Be careful when you are buying insurance. You have to look at the benefit to decide if a specific policy is right for you.