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How often should you meet with your financial planner?
Almost any advisor will say at least annually. Many clients, however, believe they only need to meet with their financial planner when they have a specific need, when something financially requires attention.
I recently had a conversation with a client of another planner that really highlighted this mindset. She shared, “I would hesitate to schedule a meeting with my planner if there was nothing going on, no real problems, nothing really new in my life. I would feel guilty, like I was taking up their time when it could be better used by someone else who really has an issue.”
This sentiment is not uncommon among my clients. They often feel that if everything seems fine, there’s no reason to schedule a meeting. However, most financial planners recommend an annual financial planning checkup, regardless of whether there’s an immediate need. Why? It’s much like an annual medical wellness check. You might feel perfectly healthy and not notice anything wrong, but that doesn’t mean there isn’t an unidentified issue.
An annual physical can catch high blood pressure, high cholesterol, or other silent health risks before they escalate. Your financial health is no different. The purpose of a wellness check is to detect problems before they become serious, ensure you’re on track, and make any necessary adjustments.
Here are some of the benefits of an annual financial checkup:
- Early detection of problems. An annual financial review meeting can reveal potential risks, such as a needed change in asset allocation, changes in tax law, or an outdated estate plan. By identifying these early, you can act before they become significant problems.
- Reassessment of your status. Life changes over time. Just as your doctor may adjust your treatment or lifestyle recommendations, your financial planner can suggest modifying your financial plan to reflect potential job changes, shifting family circumstances, the needs of aging, or evolving goals. Regular reviews help to keep your financial strategy aligned with your current situation and long-term needs.
- Peace of mind. When you leave a doctor’s office with a clean bill of health, you feel reassured. The same applies to financial checkups. Meeting with your planner regularly ensures you’re informed, your questions are answered, and you’re confident that your financial plan is still on track.
- Preventing overreactions. Financial checkups, like annual health checks, are about being proactive in avoiding crises. They allow you to rebalance your portfolio, review insurance coverage, and make other strategic adjustments to prevent financial “emergencies” that might result in panicky decisions.
- Staying up to date. Medical guidelines evolve, and so do financial planning standards. What worked well last year may not be optimal today. An annual review helps you adapt to changes in laws, tax codes, and market conditions.
- Maintaining the relationship. Regular meetings foster the trust and transparency that are crucial in a planner/client relationship. Even if there are no particular financial issues to discuss, a conversation helps keep lines of communication open. If a planning firm uses a team approach, meetings help clients get to know team members individually rather than seeing them as shadowy figures behind the scenes.
Just as you wouldn’t skip your annual physical even when you’re feeling fine, it’s not a good idea to skip a periodic check-in with your financial planner. It is not an imposition or a waste of time. For both you and the advisor, it is an opportunity to catch hidden problems, stay informed, and exchange ideas.
Don’t wait for financial symptoms to show up. Annual financial checkups can help maintain your current financial fitness and support your long-term financial wellbeing.
Related: Are Boomers and Gen Xers on Track for Retirement Success?