Most people think financial planners and accountants only aid big companies and organizations with their finances. However, there are instances when you as an individual might need the assistance of one or both of these two financial experts.
For instance, if you are stuck with doing your taxes or you are trying to calculate your cumulative net worth, an accountant can be of great help. On the other hand, for all matters regarding how to manage your money such as where to invest, how to make use of your inheritance and other things, you can seek the services of a financial planner.
To help you understand better the roles of accountants and financial planners, below are instances when you might need each of them.
When You Might Need the Services of an Accountant
Despite the prominent role played by accountants in the financial world, their services are usually required by specific individuals. You can make use of an accountant’s expertise when the money in question is relatively large or rather when you are handling a complex tax issue. To high-income earners with a lot of investments and properties, an accountant can help manage your finances.
In summary, accountants, unlike financial planners deal with specific issues. Nonetheless, they can significantly contribute to helping you save more. Here are situations when you may need to hire an accountant.
1. If you are running a big business or are a high-income earner, then an accountant can help you manage your taxes and keep inventories on your expenses versus profits.
2. An accountant can also be quite helpful to real estate owners and landlords. Similar to being a business owner, running a real estate require accurate bookkeeping, and this is something accountants can do professionally.3. When you are facing a complex tax situation. Note that most people can easily file taxes with the assistance of tax preparation software. However, those who have multiple businesses or vast financial sources, they are likely to find it difficult when it comes to filing taxes. Having an accountant chip in can make things less complicated.
4. An accountant can also be of service when you are going through a huge life change which involves a lot of money. Examples of such instances include when you are buying/selling property, adopting a child or even when you happen to win the lottery. An accountant will give you peace of mind knowing that your finances will be well managed.
What about a Financial Planner? Here’s When You Might Need One
Unlike accountants, financial planners offer services needed by most people. Budgeting and investing is part and parcel of everyone’s life. To succeed in either, you can hire a financial planner to help you out.
These professionals can either give you solid financial advice on how to budget your finances or get out of debt. And, you can also work with them hand in hand in formulating a financial plan that can help you realize these objectives.
One characteristic that distinguishes a professional financial planner from an amateur is honesty. He/she shouldn’t only tell you what you need to hear. A financial planner should clearly indicate whether making a particular investment will give you profits or it will plunge you into debt.
It is also the role of a financial planner to motivate and advise you on how you can get yourself out of debt. When looking for one, you need to be keen and identify the one who meets your specific financial situation. There are those who are experienced in debt management and others in investments. Feel free to ask for recommendations. It is best if you work with an experienced financial planner.
Below are situations where you might need to hire a financial planner.
1. If you intend on investing. Investing is a bit risky. Therefore, you do need all the expert financial assistance you can get before putting your money into a particular market. The planner can give you a go ahead or provide you with alternative markets.
2. If you want to get out of debt. With the help of a financial planner, you can come up with a budget to follow so that you can make enough savings to pay your debt. A good financial planner can put to halt the living from paycheck to paycheck lifestyle.
At Times You May Need to Hire Both
In some cases, you may need to hire both. The accountant will manage your finances, and the financial planner will ensure that your business stays on track.
Hiring an accountant is also skilled in financial planning is an added advantage. Moreover, when hiring both of these financial experts, you need to consider their reputation highly. You need to be confident that the accountant will handle your taxes diligently and the financial planner will ensure you make excellent investment decisions.
An accountant and a financial planner can help you achieve your financial objectives.