Small business owners have to wear many hats on a day-to-day basis. While there are many tasks that they can (and must) handle themselves, it is important to know when to approach outside help.
Knowing when to approach a financial advisor is an important part of running a business. A financial advisor is there to help individuals and businesses make smart decisions concerning their money and investments.
It is a bit of a balancing act, knowing the right moment to seek that outside help. Do it too soon, and you’re spending money you can’t spare. Do it too late, and you risk running into financial difficulties down the road.
The Cost of Financial Advisors
According to Money Under 30, financial advisors don’t have an agreed-upon price, so it varies. However, there are a few ways to break it down and get a better idea of what to expect. There are three ways in which a financial advisor may ask to be paid. Remember that they could potentially ask for a combination of the following. They could ask for an annual retainer – a set fee in exchange for providing a plan.
Likewise, they could be seeing a percentage of the investment, which means that the financial advisor could charge a flat percentage and benefit from the gains of your companies successful ventures. Finally, there’s the hourly rate. That one should be self-explanatory at this point.
Types of Financial Advisors
There are several different types of financial advisors out there, and you’ll want to make sure you find the right one to guide you in your investments. While NerdWallet dives into the categories in further detail, here are the basics. First, there are Robo-advisors. They’re the lowest cost option (usually) and can help with basic or common concerns.
Online financial planning services are another option. This is a good route to go if you’re looking to speak with an actual human, though not face to face. They will be available either online or through the phone. If you’re okay with that, this option is ideal. They can provide a more insightful and personalized plan than what a Robo-advisor could manage.
Traditional financial advisors are likely what most people picture when thinking of who to approach. These are people you can meet in person and are usually part of a larger company designed to help individuals and businesses.
Trusting Your Advisor
One of the biggest concerns when finding a financial advisor is choosing one that you can trust. Make sure to take the time to look into their reputation, both the individual and their company. Reading through past testimonials is another way to gauge their experience and set expectations.
When to Get Help
If you find yourself hitting a point where you’re lost, concerned, or confused about the next step in your financial future, then now is the time to approach a financial advisor. Likewise, if you’re feeling overwhelmed, either by the entire process, then now is the time. Even if you are simply tired of taking on so much on your own, now is the time.
Lastly, if you feel that an impartial third party would have insightful information for your decision-making process, then trust your intuition. Both you and your business will benefit from that outside source.
The time to approach a financial advisor varies from business to business, and ultimately it a fairly personal decision to make. As the one running your business, you are the most capable of knowing when you have hit that point. Just remember, there is nothing wrong with hiring outside (and experienced) help.