I am 67 years old, retired, with a $3 million portfolio and a fully paid-off house. I do not have any major financial concerns. Is it worth hiring a financial planner to ensure that we remain on the right track?
According to a 2024 survey by Northwestern Mutual, Americans believe that $1.46 million is the amount needed for a comfortable retirement. However, a 2022 Federal Reserve survey discovered that Americans aged 65 to 74 only have a median retirement savings of $200,000. This indicates a significant gap that the average retiree needs to bridge.
With a $3 million portfolio in retirement, you are well ahead of the curve. Not only do you possess more assets than the typical American retiree, but you also exceed the estimated $1.46 million necessary for a comfortable retirement per person.
You might be contemplating whether it is beneficial to engage a financial planner to manage your retirement portfolio. There are advantages and disadvantages to seeking financial assistance.
Working with a financial professional provides the benefit of having an unbiased expert guide you on how to manage your assets. This can be invaluable, especially in unforeseen circumstances.
While things may currently be stable financially, unforeseen life events or health issues could arise, necessitating long-term care. A financial planner can help you prepare and manage these potential costs as they emerge.
Although you have successfully accumulated $3 million for retirement through saving and investing, there may be areas in your portfolio that require attention. A financial professional can address these blind spots and ensure that your portfolio generates income while also withstanding market fluctuations or inflation.
Considering your substantial assets, you may have the opportunity to leave an inheritance. However, the value of $3 million today may differ in the future due to inflation. A financial adviser can assist you in estate planning to make informed decisions about the legacy you wish to leave behind.
Furthermore, working with a financial adviser can provide a sense of security as you navigate your senior years. This partnership alleviates the pressure of being the sole expert and staying updated on financial matters.
Northwestern Mutual reports that 64% of Americans with a financial adviser feel financially secure, compared to only 29% without one.
Uncertain about what to do next? Stay calm. Here are five simple ways to quickly catch up on managing your finances solo.
One drawback of working with a financial professional is the added cost, which can vary based on factors like location and fee structure. By handling your finances independently, you can avoid paying these fees. For instance, if a financial adviser charges a 1% fee on assets under management, you could be paying $30,000 annually for services you might not require.
Financial advisers are often incentivized to grow your portfolio, but once you reach retirement and prioritize stable income, their services may become less essential. If you’ve successfully managed your portfolio thus far, you might possess the necessary skills to continue without additional help, especially if you’re knowledgeable about investing and diversification.
While financial advisers can provide insight on estate planning, you may still need to consult an attorney for legal documents like wills or trusts. Ultimately, it’s wise to seek advice from a few advisers before deciding if you truly need their assistance. If you’ve effectively managed a $3 million portfolio on your own, you might not require extra support at this stage. Just ensure you’re well-informed before making any significant financial decisions.
For further reading, learn how to avoid falling victim to cybercrime, identify items Americans tend to overpay for, and safeguard your retirement savings with essential money moves. Remember, this information is for reference only and does not constitute financial advice.
