Do You Need a Financial Advisor After You Retire?

Retirement changes how people think about money. While income may shift from a paycheck to Social Security, pensions or investment withdrawals, your financial decisions don’t stop. A retirement financial advisor can help manage withdrawals, balance risk, plan for taxes and support long-term goals. Whether you need one depends on how comfortable you are making these decisions and how complex your finances are after you stop working.

Consider working with a financial advisor when you retire.

What Can a Financial Advisor Do for You?

A financial advisor helps you organize, manage and plan your finances so that you can reach your goals before and during retirement.

Their role can vary depending on your needs, but generally, a personal financial advisor provides guidance in several areas, such as:

• Budgeting and cash flow management
• Investing and asset allocation
• Retirement income planning
• Setting and tracking financial goals
• Risk management and insurance planning

While some advisors may offer tax planning insights, such as how withdrawals or investments could affect your tax bill, they typically do not prepare taxes or provide accounting services. Instead, they often coordinate with accountants or tax professionals when clients need more specialized advice.

Ultimately, a financial advisor focuses on your overall financial picture, helping you align your resources with your long-term objectives. For many retirees, a retirement financial advisor will manage retirement accounts, adjust investment strategies and maintain financial stability throughout retirement.

How Your Finances Change in Retirement

For most households, financial goals shift in retirement, moving from accumulating assets to spending and managing them. You no longer actively earn new income on a regular basis. Instead, you live off a portfolio of savings and assets built up over the years.

Retirement also brings its own set of financial considerations. Most households no longer have dependents, so at retirement age, you’re less likely to worry about caring for minor children, college tuition or elderly parents. That said, you’ll need to start planning for your own long-term retirement expenses.

A few financial concerns are common in retirement:

• Growing healthcare expenses
• Potential long-term care costs
• Rising cost of living on a fixed income
• Sequence risk, or having to withdraw assets during a market downturn
• Life expectancy and portfolio duration
• Estate planning

These aren’t issues unique to retirement, and not every retiree will need to manage all of them. However, they’re common enough to at least consider in your long-term planning.

A core challenge in retirement is flexibility. Once you shift from earning new income to living off your portfolio, it becomes harder to adjust your financial footing.

During your working years, it’s relatively easy to recover from an unexpected expense or save toward a new goal. In retirement, that kind of flexibility narrows. This is why managing this shift well is central to a successful retirement.

Do You Need a Financial Advisor in Retirement?

Many people think of their financial advisor as someone who helps them save for retirement. In this view, once they retire, the advisor’s job is done. In reality, retirement often introduces a different set of financial decisions rather than ending them.

For example, a retiree might build an income-based portfolio that generates payments from annuities and long-term bonds. This retirement account would provide indefinite income and require much less investment management in retirement. However, decisions around taxes, withdrawals and account coordination still apply.

On the other hand, a retiree might have a portfolio built around capital assets. This portfolio would likely capture more growth during retirement. However, since it generates income only by selling assets, it would require much more active investment management, as well as careful withdrawal timing and tax planning.

The nature of your portfolio can go a long way toward determining the importance of ongoing advice. A portfolio that needs more active management will generally benefit from more advice in retirement. Still, even simpler portfolios can require guidance on taxes, healthcare costs, income sequencing and estate planning considerations.

Cost of a Financial Advisor

Beyond that, a good way to consider this is in terms of cost.

Advisors typically charge a fee based on a percentage of your assets under management (AUM). According to Kitces, a typical fee schedule works like this.

• 1% on the first $2 million in AUM.
• 0.9% on the next $3 million
• 0.75% on the next $5 million
• 0.60% on assets exceeding $10 million ¹

Can you afford to continue paying your financial advisor? If so, this is probably a good relationship to maintain. Many of the issues surrounding personal finance grow only more important in retirement.

Finding a Financial Advisor for Retirement

There are several considerations to aid in your search.

• Type of advisor. Choosing the right financial advisor in retirement starts with identifying the right type of advisor who understands income planning, withdrawal strategies and how to make assets last.
• Retirement planning. Retirees should look for an advisor who specializes in retirement planning rather than accumulation. This is because your focus will gradually shift from growing wealth to managing it sustainably.
• Credentials. Credentials like the Certified Financial Planner™ (CFP®), chartered financial consultant (ChFC) and retirement income certified professional (RICP) can also provide confidence that an advisor has specialized training in retirement issues.
• Cost. Fee structure is another key consideration. Many retirees prefer fee-only fiduciary advisors. These advisors are legally obligated to act in their clients’ best interests and don’t earn commissions from selling products.

Online tools, such as SmartAsset’s matching tool, professional associations and referrals from trusted sources can help narrow the search.

Once you’ve found a few potential candidates, schedule introductory meetings to discuss your goals, risk tolerance and income needs. The right advisor will take time to understand your situation and build a financial plan that supports both your lifestyle and peace of mind throughout retirement.

When You May Not Need a Financial Advisor in Retirement

There are some cases when a financial advisor may not be as necessary.

• Predictable retirement. Some retirees have income sources that cover most or all routine expenses. Social Security, a pension or annuity payments may provide steady cash flow that reduces the need for ongoing portfolio management. When spending needs are predictable and largely met without selling investments, financial decisions tend to be more limited.
• Simple retirement plan. A retirement portfolio built for simplicity can also reduce the need for regular advice. Households that rely on broad index funds, maintain a fixed asset allocation and rebalance infrequently may face fewer day-to-day decisions. In these cases, investment oversight often becomes more mechanical than strategic.
• Straightforward tax situation. Retirees with one or two account types, modest taxable income and straightforward withdrawal patterns may face fewer planning issues. When required minimum distributions, capital gains and Social Security taxation are already familiar, outside coordination may be less relevant.
• Comfort level. Personal comfort with financial management plays a role, as well. Some retirees prefer to monitor balances, track spending and manage withdrawals on their own. If you already review your finances regularly and feel confident making adjustments, ongoing advisory support may feel redundant.

Finally, some retirees choose limited or occasional help instead of a full-time advisory relationship. Hourly consultations or one-time reviews can address specific questions without committing to ongoing fees.

This approach may fit retirees who want periodic guidance while retaining direct control over their finances.

Bottom Line

Most people think that their financial advisor’s job is done once they help them retire. In fact, it’s often just getting started. As you try to navigate the financial ups and downs of retirement, it can be just as important to have an advisor at your side as it was when you were working and preparing for the big change.

This is where ongoing guidance can come into play. Brandon Renfro, CFP®, RICP, EA says: “Not everyone needs a financial advisor in retirement, but a retirement-focused financial advisor can offer expertise for navigating a wide array of financial issues. They can also take the hassle out of doing it all yourself, allowing you to focus on other things.”

Brandon Renfro, CFP®, RICP, EA, provided the quote used in this article. Please note that Brandon is not a participant in SmartAsset AMP, is not an employee of SmartAsset and has been compensated. The opinion voiced in the quote is for general information only and is not intended to provide specific advice or recommendations.

Financial Advising Tips

• Getting help to manage your money can be important when you’re thinking about retirement. Finding a financial advisor doesn’t have to be hard. SmartAsset’s free tool matches you with vetted financial advisors who serve your area, and you can have a free introductory call with your advisor matches to decide which one you feel is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
• Don’t forget that your financial advisor is key to helping you set up that retirement account in the first place.

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