Do You Need a Financial Advisor? Ask Yourself These 7 Questions

If you’re trying to reach big financial goals, like paying down debt, saving for your kids’ college educations, or planning for retirement, you might consider hiring a financial advisor, a professional who can help you make important decisions about investing, estate planning, taxes, and more.

Many people believe you need a high net worth or multiple investments to hire a financial advisor, but that’s not necessarily true. There are many types of financial advisors with varying fee structures. However, you might be able to DIY your financial planning instead. Here are seven questions to help determine which route is best for you.

Table of Contents

1. 1. Are your finances getting more complicated?
2. 2. Are you preparing for retirement or already retired?
3. 3. Are you unsure how to invest your money?
4. 4. Have you experienced a major life event?
5. 5. Are you trying to minimize taxes or estate issues?
6. 6. Do you want personalized help beyond robo-advisors or forums?
7. 7. Do you have enough money to work with an advisor?

1. Are your finances getting more complicated?

Most people don’t need to hire a financial advisor when they’re just starting a career. When your finances are simple, with one income or a single retirement account, it’s easier to plan. However, as your finances get more complicated with multiple income streams, buying real estate, or starting a business, hiring an advisor can give you a sounding board as your wealth grows.

Advisors can also give you tax planning advice, help you set long-term investment goals, and even ensure your estate is in order should something happen to you. The more complicated your finances get and the more assets you acquire, the more helpful it is to have a financial professional to turn to when you have questions.

The most common reason I see first-time clients is they’ve been managing their own planning and investing but have reached a point where they’re looking for greater clarity and direction. Working with a professional helps them feel more confident about their path and ensures they’re making informed decisions to achieve their life and financial goals.

Why do I need a financial advisor?

Not everyone needs a financial advisor, but here are some situations where getting advice from a financial advisor can be helpful:

• Starting a business where you need advice on choosing the best business structure
• Having difficulty planning your finances with variable income, like self-employment income or sales income
• Parents who want help planning how to send their children to college debt-free
• Investors who manage multiple businesses or real estate assets
• Anyone who is uncertain about retirement planning and needs sound advice

2. Are you preparing for retirement or already retired?

One of the most common reasons people consult financial advisors is for help with retirement decisions. Not only do you need to invest enough to fund your retirement, but you must consider several withdrawal strategies once you actually reach retirement. 

A financial advisor can recommend income distribution strategies and tell you the best time to start taking Social Security payments. Retirees also need to consider long-term care needs, Medicare, and estate planning.

Do I need a financial advisor for my pension or 401(k)?

The Financial Industry Regulatory Authority (FINRA) cautions consumers to carefully choose a pension payout option because once you do, you usually can’t change it. For that reason, it’s wise to consult a financial advisor if you’re unsure of which option is best.

If you have a 401(k), you have more flexibility in withdrawing money for retirement, but a financial advisor can help ensure your retirement money lasts as long as possible.

3. Are you unsure how to invest your money?

It’s common to worry about investing and market volatility. If you’re not sure how to invest your money, speaking to a financial advisor can help you feel more confident about your investment decisions. 

A 2024 white paper from the World Economic Forum called The Future of Financial Advice reported that employees who are doing well financially are more productive. Conversely, money worries can have a negative impact on your overall well-being.

Do I need a financial advisor to invest?

No, you don’t need a financial advisor to invest money. You can invest on your own by opening a brokerage account and purchasing an investment, like a stock or mutual fund. However, if you’re unsure how to invest your money or you’re anxious about your financial future, talking to a financial advisor can alleviate money stress.

4. Have you experienced a major life event?

According to Charles Schwab’s 2024 Modern Wealth Survey, respondents felt they were doing better financially than previous generations. Half of them said the reason is that they have more ways to build wealth today, and just under half said investing is more accessible to them than it was for earlier generations.

However, even though there are more financial resources than ever before and more ways to build wealth, an advisor can help you navigate major life events in a way that benefits you most. For example, an advisor can help you with significant life changes, such as getting married, starting a family, inheriting a substantial sum, or going through a divorce.

When do I need a financial advisor?

You need a financial advisor if you want help making the best possible decisions after a major life event. For example, if you want to save for a child’s education or if your spouse passes away unexpectedly, a financial advisor can help you navigate the decisions that come with that. This is especially helpful if you’re uncertain or anxious about your finances and next steps.

5. Are you trying to minimize taxes or estate issues?

Financial advisors can help you with tax strategies and estate planning, and more consumers are looking for financial advisory firms that offer a full range of services related to taxes. You can go to a financial advisor to help you invest and withdraw your retirement money in the most tax-advantaged way. 

Do financial advisors help with taxes?

According to research from consulting firm Herbers and Company, 90% of consumers want tax planning from their advisory firms, but only 73% of firms offer it. Some financial advisors work with accountants who can file taxes for clients. However, many advisors offer tax planning advice but don’t physically file taxes on their clients’ behalf.

If you want more comprehensive advice for your taxes or estate planning, research financial advisory firms that offer a range of services or at least have close professional relationships with accountants and estate attorneys they rely on to help their clients.

6. Do you want personalized help beyond robo-advisors or forums?

Many people read forums to get investing advice and use robo-advisors for their retirement planning. In the future, according to Deloitte, more and more people will use AI investment tools and AI-enabled financial advice. What’s best for you comes down to your individual preferences.

Can I use a robo-advisor instead of an in-person financial advisor?

If you’re comfortable managing your investments yourself using a robo-advisor and you’re confident about your retirement strategy, using a robo-advisor can be helpful. Interestingly, the 2025 J.D. Power U.S. Investor Satisfaction Study showed that 27% of DIY investors say they’ll consult a financial advisor over the next year. 

Sometimes, having the option to speak with an advisor in person, especially during times of economic uncertainty, can help even the savviest DIY investors feel more confident in their decisions.

7. Do you have enough money to work with an advisor?

Many people mistakenly think financial advisors are only for high-net-worth individuals. While some firms may have high minimum investment requirements, many options are available for those just starting their wealth-building journey.

How much money do I need for a financial advisor?

Some advisors don’t have minimum investment requirements and instead charge a flat fee, while others might require you to invest a specific amount with them. Advisors earn money in different ways:

1. Hourly rates: Some financial advisors offer hourly rates where you can ask a specific question or get advice.
2. Fixed fees: Many fee-only financial planners charge a flat fee for advice based on your net worth or the assets you want to invest. 
3. Assets Under Management (AUM) fees: A common way financial advisors earn an income is by charging you a fee of 1% to 2% of the assets you have under their management.

It might take some time to find an advisor who is a good fit for your situation and budget, but you can start your search by locating a CFP professional in your area. 

The XY Planning Network is also a great resource to find a fee-only financial planner. Planners list their fee options on the website as well as the types of clients they serve, such as millennials, women, underserved communities, and more.

Our 2025 recommendation

If you need professional financial advice for retirement planning, tax optimization, or estate planning, we recommend consulting a financial advisor for help. However, if you want to learn budgeting basics and beginner investing, many free tools and resources can help you learn these skills.

A financial advisor is also helpful if you are anxious about money, recently went through a major life event like divorce, or came into a large sum of money and want to make the best choices for you. As with anything, take your time to do your research to find a financial advisor who has your best interest in mind and who charges a fee you can afford.

If you don’t want to commit to a long-term partnership with an advisor, you can work with one who offers advice by the hour or one who charges a flat monthly fee. If you feel like you want a comprehensive plan and ongoing advice and management, a full-scale advisory firm might be a better fit.

When choosing a financial advisor, start by identifying your specific goals and asking trusted friends or family for recommendations. Interview at least three advisors from different firms to find someone you connect with. Look for credentials, like CFP®, CFA, or CPA, but also pay close attention to communication style and transparency about fees and process. You should feel comfortable sharing your goals and confident that the advisor understands how to help you reach them.

Need a place to start?

Take a look at Money Pickle, especially if you’re not sure what kind of advisor you need. The service will match you with a vetted financial advisor online, and your first 45-minute consultation is completely free. Whether you want one-time guidance or ongoing support, Money Pickle makes it easy to get help on your terms.

Scenario	DIY tools	Financial advisor
Learning how to budget	✅
Learning investing basics	✅
Retirement planning		✅
Tax strategies		✅
Estate Planning		✅
Multi-business financial management		✅
Advice after major life events		✅
Anxious about investing or making mistakes		✅
Comfortable with managing finances and planning	✅