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How Much Does It Cost To Work With a Financial Planner?

How Much Does It Cost To Work With a Financial Planner?

Creating a financial plan allows you to take control of your income, design your future, and take logical steps towards your goals. Working with a professional Financial Advisor is generally the best way to create an actionable financial plan. But sometimes, potential customers are worried about the cost of financial planning. They wonder whether they can afford to hire a financial planner, and if doing so is worth the cost.

We can’t fault you for having these concerns. Actually, the fact that you’re pondering the return on investment of financial planning shows a sort of money wisdom that should serve you well over the years. However, we can assure you of one thing: working with a Financial Planner is worth the cost — and the cost is likely more affordable than you’re imagining.

How Much Does Financial Planning Cost?

It’s impossible to assign a specific dollar amount to our services because the cost varies from client to client. Every client seeking financial planning has different needs. For example, a college student will have very different needs than someone who is about to retire. A single person in their 30s will have different needs than a 35-year-old with 3 children. 

As Independent Financial Advisors, we are able to work with each of our clients as individuals. We get to know them, their lives, their goals, and their desires before determining what type of financial plan will benefit them the most. Once we get to know a client, we have a better idea of what level of expertise is required to create their financial plan. Only then can we more accurately assess what tasks are involved with creating their financial plan, and how many hours those tasks will take to complete.

Creating a basic financial plan for a new graduate generally requires fewer hours and less expertise than crafting a long-term plan and retirement goals for the owner of four businesses. As such, these two clients will have significantly different financial planning costs.

This individualized approach has advantages for both the client and the financial advisor. It ensures the client receives personalized services and only pays for the services they actually receive. It also ensures the financial planner has the flexibility to perform and charge for the services they know are most beneficial to the client.

How Are Financial Planners Paid?

We know that cost is often a concern for many customers, which is why we offer several different payment options. 

One option is to pay for your financial plan as a lump sum. If you have the money set aside to pay for financial planning, this is often the easiest approach. With your bill paid off, you can move on to saving for other things. 

The other option, which is one we commonly recommend, is paying for your financial planning by way of a monthly service charge. Through this approach, we keep working with you, month after month, to create and hone your financial plan. We fine-tune it over time, making it more and more comprehensive as time goes on. You pay a fee each month for the ongoing service. This approach works really well for clients who are not ready for a comprehensive financial plan right away, and for those whose lives are changing rapidly. 

A financial plan is incredibly important for people of all ages and incomes. As such, we can be flexible as to how we create and bill for your plan. If you have concerns about the cost of financial planning or how we bill our clients, we welcome you to bring them to our attention. We’ll do our very best to work with you and make financial planning an affordable reality for you.

Is Financial Planning Worth The Cost?

Here’s why we always recommend financial planning, even though it does cost some money: you’ll save more than you pay for the service. 

In other words, by working with a financial planner, you will save and earn more money over time. Those additional savings and earnings will, almost always, be greater than the money you spend to work with a financial planner. 

Here are a few specific ways in which financial planning offers a great return on investment:

  • Smarter Budgeting: Your financial plan can include a budget, which will help ensure you spend your money wisely and have more to save.
  • Higher-Earning Investments: Allowing a financial planner to help educate and guide you about your investments often helps you make more lucrative investments over time.
  • Better Retirement Savings: A financial planner will ensure you’re able to start saving for retirement, and also that your retirement funds return as much as possible.

In fact, you can think of financial planning as an investment, one that helps you understand why it’s worth the cost. You invest a certain amount in financial planning early on, and by the time you retire, you’ve earned many times more than that initial investment, thanks to the advice you received from your financial advisor.

Financial planning is not just for the wealthy. Everyone can benefit from a financial plan, and we do our best to make our services affordable for clients in all stages of life. We take pride in communicating honestly with our clients and being transparent when it comes to your money and your plan. If you’d like to schedule an appointment with us, contact RLJ Wealth Management. We’d love to discuss your goals and help make them a reality.