You’ve heard the old saying, “No one is an island.” But when it comes to your personal finances, you’ve been feeling quite adrift. Your debt is like a pack of sharks circling your personal island. They’ve got sharp teeth in the form of high interest rates, and they’re keeping you from swimming to the safer shores of financial stability. You’re hopeless — until you hear the whoosh of helicopter blades and look up and see someone in a snappy suit extending a hand.
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It’s a dramatic scene, for sure. However, it describes the powerful relief that can come from finding a trusted financial advisor who can help lift you out of debt. The truth is, you don’t have to crudely fashion a raft or try to swim through those murky, shark-infested waters on your own. Here are four reasons you’ll be better off working with a financial advisor.
1. They Can Help Give You a Complete Picture of Your Finances
So, you’ve tried things your way, and your way is decidedly not working. Financial advisors are better equipped than you are to give you a holistic view of your finances, including isolating spending habits that contribute to debt.
With a financial advisor, you’ll gain someone who can paint a picture of your entire financial situation — and if that picture isn’t rosy, they’ll tell you so. If you’ve got multiple forms of debt, they can help you parse what’s going on with your interest rates while also identifying ways to bring in additional income.
This all sounds scary, but it doesn’t have to be. A financial advisor isn’t there to scold or embarrass you. Their goal is to help you feel empowered and make your debt feel manageable. Working together, you can even approach managing your debt as a first step toward rebuilding your financial foundation.
2. They Can Help You Get Organized
Remember that time you tried to list out all your debts and work out a repayment schedule on your own? Remember that urge to throw your laptop out the window and curse the entire family line of the person who invented spreadsheets? Yeah, a financial advisor can help you avoid all of that.
A financial advisor can help you develop a tool, such as a spreadsheet, to track your monthly payments, including minimum payments, due dates, and projected payoff dates for each debt. While the process might not be completely painless, having their expertise can make it much easier — and less overwhelming — than trying to figure it all out on your own.
Also? Financial advisors know tips and techniques for managing debt that you likely don’t, such as the “snowball method.” This involves making minimum payments on all your debts while putting any extra money toward the smallest one. Once you’ve paid that one off, you can use those freed-up funds to tackle the next smallest debt — and lather, rinse, repeat.
3. They Can Help You Budget to Get Out of Debt
The rest of your financial needs and obligations don’t stop just because you’re planning to get out of debt. You still have to figure out how to cover necessities while creating a plan to pay off your debt.
A financial advisor can review your cash flow, along with your bills, tax statements, and other relevant financial documentation, to create a budget that keeps you afloat while you pay down debt. If you’re struggling to determine what, exactly, counts as a necessity versus discretionary spending, they can guide you through those decisions too.
4. They Can Help You Understand Your Debt
Despite what you may think — that all debt is a brick wall of misery and obligation — the truth is that all debt is not created equal. The interest rate on your mortgage might be more manageable than the rate attached to a credit card, or certainly a payday loan.
Financial advisors understand how debt works. They can analyze and explain your debt while simultaneously working on a plan to prioritize your payments. They can also explore ways to restructure and consolidate debt, such as encouraging a homeowner with equity to take out a home equity loan to pay off high-interest credit cards.
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If the thought of trying to pull yourself out of debt makes you want to bury your head in the sand, take a deep breath. Partnering with a financial advisor can help you pay down your debts much faster — and more painlessly — than going it alone. A financial advisor can help you understand your whole financial picture, plan a budget focused on paying back your debt, and consolidate or restructure your obligations.
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This article originally appeared on GOBankingRates.com: 4 Reasons a Financial Advisor Can Help You Get Out of Debt Faster Than You Can on Your Own
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