Do you ever wonder how a financial advisor adds value to their clients’ lives? Investments, cash flow analysis, wah wah wah… The words start sounding like Charlie Brown’s teacher. So, let’s try another way to think about it. Last year, my family and I went through a major home remodel. During that time, I thought about how going through a major home renovation is like building a customized financial plan. And how the real game changer for our home remodel was hiring professional experts to guide us. Special thanks to Susan Rogan and Kristen Adams of Rogan Adams Design!
Here’s how a customized financial plan is like going through a major home renovation:
A home is most people’s biggest single investment. While we want to enjoy our home, we also want to maintain and enhance our home’s value. In our home, we wanted to move our washer/dryer. For approximately the same cost, we could either move the laundry to the upstairs or to the mudroom on the main floor. Our designers and contractor let us know that from a resale point of view, prospective home buyers had a strong preference for laundry on the same floor as the bedrooms. Would our home value plummet from putting the laundry on the main floor? Probably not. But it was not the optimal choice.
Similarly, a financial advisor outlines the pros and cons of financial decisions, which can help you use your money in the most optimal ways. Having a trusted money partner also keeps you from making mistakes that you would have to undo later, which may be costly to fix.
Like any home project, we started small. We wanted to update the kitchen. That’s it. Then we wanted more natural light in the kitchen. That led to moving a wall, which led to raising a floor. And so on and so on. The project eventually exploded to touching aspects of the whole house.
When people think of hiring a financial advisor, they think they only need help with investments. Then they realize how so many other topics affect their overall financial picture – taxes, employee benefits, inheritances, equity compensation – and how interrelated they all really are.
In all honesty, I always thought that hiring an interior designer was bougie and reserved for “rich” people. Growing up, if our house needed something done or fixed, my dad did it. He finished the bathroom and basement all by himself. He certainly wasn’t happy when his two kids flooded the newly remodeled basement by bringing the hose into the house to clean the vinyl floor in the kitchen. (There may or may not have been some slipping n’ sliding. 😳 Oops.) In our defense, we did use dishwashing soap for the floor, so it was super clean (and soap helped with the slip). I digress…
Even though I knew we couldn’t do the actual construction ourselves, I thought I should totally be able to do the interior designing myself. All I had to do was go on Houzz and Pinterest, right? OMG, WRONG! So, so wrong. There were so many choices. Hours and hours of time flew by in the blackhole of home renovation websites. Who knew there were so many different types of cabinets?
Also, there was so much conflicting “expert” advice of what NOT to do that I was totally confused and overwhelmed. The result was me overanalyzing and being completely paralyzed from making any decisions.
Enter Susan and Kristen. They were able to narrow down options. Also, I trusted them to tell me if there was something I definitely shouldn’t do, rather than listening to all the voices on the internet.
As a result, I wasn’t so overwhelmed because I had knowledgeable, experienced professionals advising me. It also helped alleviate the stress of second guessing every decision. See the parallels of working with a trusted financial advisor?
There were times when our general contractor couldn’t hire his usual outside contractors because they were already booked when we needed them. Susan and Kristen have their own professional network of contacts (who for some reason are all named Jeff). These contacts were able to step in and get the work done. And, in some cases, they were cheaper than who our contractor would have hired! We were grateful for their network of trusted professionals. Susan and Kristen also found us the general contractor we loved.
It’s impossible to know the technical aspects of everything that touches one’s personal finances. Your financial advisor can help you find the right professionals, like an accountant or estate attorney, when you need them. And they can help you ask the right questions.
Everyone’s home is unique to them. The floor plan may be the same, but you put things in your home that make your home comfortable to you. Susan and Kristen worked with me and my husband to get a sense of how we wanted our home to look and feel. Sometimes we didn’t know or didn’t have the words. They showed us options that we didn’t even know existed. And they helped us with unfamiliar terminology and jargon. I had no idea what a sconce was until I worked with them.
This is the same with your financial plan and investments. You may have the same income as your neighbors, but your goals and values are different than theirs. How you want to live your life is unique to you. And how and where you spend your money is personal. It’s why your financial plan and investment portfolio should be custom-built and tailored to you.
Both interior designers and financial advisors listen to their clients’ unique needs to understand what is important to them, to create a cohesive vision, and to help prioritize and organize the never-ending list of to-dos.
Hiring interior designers is something I never thought I would ever do. Also, they aren’t cheap! However, both my husband and I whole-heartedly agreed that Rogan Adams Design was worth every penny. Their expertise and experience gave us peace of mind that we were on the right track. With their oversight, we knew we wouldn’t make any major renovation mistakes because of our lack of knowledge of all things home renovation.
The endless choices and information were JUST. TOO. MUCH. When I’m unsure about anything, my natural tendency is to deep dive into more research. This wasn’t helpful. Having professional guidance helped me understand the overall picture while they dealt with the nitty gritty, like measuring how long the pulls should be. Again, I had no idea what a pull was before this process.
Wow, I can’t even tell you the time and brain power that was saved by hiring qualified professionals to help us.
While it was nice when they had designer discounts for furniture, what really mattered was the money saved by not making a big mistake with our remodel.
I love coming home. It feels like home. With a trusted financial guide, you’ll feel more at ease by knowing you are going in the right direction. And if something throws a wrench in your plans, you have a knowledgeable partner by your side to help you navigate through.
Thanks for bearing with me. I hope this gives you a better picture of what working with a financial advisor may look like. Or, at least, this gives you another way to look at it. 😊 Whether you are upgrading your home or your personal finances, working with seasoned professionals can make the process easier and more manageable to reach your desired outcome. They guide you through the ups-and-downs of creating the perfect home or customized financial plan that is tailored to your unique needs and values.
P.S. If you are going through your own home remodel, don’t forget to track the costs for tax purposes!
Disclosure: BW Financial Planning is an Investment Adviser registered with the State of Colorado. All views, expressions, and opinions included in this communication are subject to change. This communication is not intended as an offer or solicitation to buy, hold or sell any financial instrument or investment advisory services. Any information provided has been obtained from sources considered reliable, but we do not guarantee the accuracy or the completeness of any description of securities, markets or developments mentioned. This communication is for informational purposes only and should not be construed as legal, accounting and/or tax advice. Should you have any questions and/or issues in these areas, please consult your legal, tax and/or accounting adviser.