THE BLOG
05/12/2014 11:25 am ET Updated Jul 12, 2014

Personal Financial Planning: Do It Yourself or Go With a Pro?

Now that there are at last some positive signs to indicate that the economy is improving, the question of professional personal financial help is starting to pop up again. In other words, should you go ahead and hire a pro, or should you go the do-it-yourself route?

The more than 200,000 personal financial advisers will most likely say yes, hire me, I can help you achieve your personal finance goals. On the other side of the table, the do-it-yourself crowd pooh-poohs that idea, saying hiring a pro is a waste of your hard earned money. So, which side is right?

It turns out that like many things in your life, there is no easy answer. It really depends on you and your personal situation. It depends on how much or how little you want to be involved and how much homework (research) you are willing to do on your own. That being said, let's examine the question from both sides so you can draw your own conclusions.

Hire a Pro ?

Consider that personal finance advisers are not just for the rich anymore. Sure, a wealthy Wall Streeter is probably the dream client if you happen to be a personal finance adviser. However, the vast majority of personal advisers actually serve more traditional clients -- think middle income and above. This is especially true for the fee-only personal advisers who may not even require a minimum asset size to become a client.

Reasons to Consider Hiring a Pro

1. A professional personal finance adviser is a step away from your situation. In other words, your advisor can look at your situation from an unbiased viewpoint. If you are in the middle of a personal finance crisis such as a sudden life change, either good or bad, it is so easy to become emotionally overwhelmed. Consider that your adviser may be able to pinpoint options and opportunities that you can't see.

2. As your life situation changes, your personal financial choices get increasingly complex. For example, a married couple in their mid to late forties with kids in high school has to figure out college tuition, their own retirement and investment plans, the home mortgage, what to do about elder care and so on. A personal financial adviser can help you sort through all of these options.

Do-It-Yourself

There are some people who are determined to take care of things their own way, and there is nothing wrong with this approach. If you take the time to educate yourself on the best choices, this could be the way to go.

Reasons to Consider Going the DIY Route

1. You are in complete control. Face it -- nobody cares more about your money than you do. Even the best personal financial advisers have other clients.

2. The information is already out there. If you are willing to take the time to educate yourself, you can find most everything available online. Not only that, much of this information is free.

3. It turns out that a surprisingly large number of people ignore the advice they get from a professional anyway. Or, they take some of the advice and make their own decisions on other matters.

Back to the Question

Should you hire a pro or should you go with the do-it-yourself route? As you can see from the above discussion, there are valid arguments on both sides of the issue. How about looking at this from another perspective?

Time and Circumstances

Seriously, unless you are already fairly adept in the world of finance, there is a learning curve to becoming savvy about the ins and outs of personal finance. Not only that, just because you can learn all of these things, it does not mean that you should. Really, think about it this way. Yes, you could trudge down to Home Depot, figure out materials, rent the tools, and bring it all home so that you can remodel your bathroom. But should you? Maybe, maybe not. This is a question you have to answer for yourself.

That being said, there are times in your life when at least consulting with a personal financial adviser is worth your while. For example, suppose you experience a sudden life event that radically changes your personal finances. Or, not even that extreme. Suppose you just want to go in for a checkup. In other words, there are times that, even if you are a die-hard do-it-yourselfer, consulting with a professional is the way to go.

Whichever path you choose, professional or do-it-yourself, you do need to take charge of your personal finances.

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