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When people don’t know what they don’t know, it may well feel difficult to discern when to consult a CERTIFIED FINANCIAL PLANNER™. Typically folks approach a challenge thinking there may only be 2 options…so they choose one option that appears either best, (or less damaging) to them.  Absent knowledge to the contrary, they may be making an acceptable or even good choice, OR perhaps a very expensive choice.

Not understanding the interconnectedness of investments with taxes, for example, could cost taxpayers what I call ”groups of zeros” in any one tax year. The shuffling of investments can trigger unintended and costly income tax consequences.

Not paying attention to the holding period for an asset, to determine whether it is a short or long term capital gain or loss could mean the difference of several hundred or thousand dollars.

Not titling property or a real estate purchase correctly could cause transfer-for-value issues later. What if the relationship changes such that one person no longer wants to co-own the property?

Believing that one’s latest beneficiary change form is actually on file at the plan custodian could have enormously disastrous results upon the death of the account holder, if, for example, the custodian feigns that they don’t have receipt of the latest beneficiary change.

Not changing the beneficiary on your life insurance after a divorce, figuring that in your updated will, you leave everything to your current partner, or kids, could result in those favored beneficiaries unnecessarily splitting your estate with your ex-spouse, since certain assets like IRAs and life insurance pass by beneficiary designation, rather than being otherwise dispersed through one’s will.

Not checking your homeowner’s policy for replacement cost on both your contents and dwelling, could result in thousands of dollars of lost settlement dollars should your electronics be destroyed by a lightning strike while you are only carrying actual cash value contents coverage, for example.

To simply state, “oh, my broker has handled that” is often a statement I’ve heard made in complete faith that indeed, one’s broker IS servicing their best interests. Absent a FIDUCIARY–a person /prof with only one goal; to meet the goals of their client–however, one cannot presume that “all is well with my finances, or insurances.”

Finally, not having a will, or not naming a guardian for your minor children could subject your kid(s) and relatives or friends to repeated and expensive court visits and undue family stress, all the while, they are dealing with the grief of losing you prematurely.

Hence, when to contact a financial planner may indeed be a rhetorical question. My experience has shown me (and a host of my clients) that it’s never too early to consult a Fee-Only CERTIFIED FINANCIAL PLANNER™, in order to prevent future heartache.

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