Throughout our lives as different life events happen and the need for help arises we have the opportunity to rely on ourselves to get the tasks done, or entrust in the skill and expertise of a professional. Very often there’s a fine line as to what we’ll bother doing ourselves or to whom we’ll hire and delegate the job. For mundane tasks, the tasks that we know we can do ourselves with little to no effort, it’s second nature for us to roll up our sleeves and get the job done. Examples of this include washing the car, cleaning the house, balancing the checkbook, bandaging a small cut, and doing the dishes. It’s rare that we’ll “contract out” these tasks as they are very limited in the expertise needed to get them done, and from a frugality standpoint, most of us are willing to accept the trade-off of doing the work and allocating the money that would have been spent elsewhere.
For the not so mundane or more labor intensive, or perhaps mentally intensive tasks we may choose to again do the work ourselves or hire a professional. Often these decisions are determined by how long the project will take, resources available, and how much time we have to commit to the project. Examples of this include automobile maintenance, home repairs, treating a sprained an ankle, and income tax preparation. The decision here boils down to time, money and what we think we know about the job.
Finally, there are the tasks where we seek out the help of a professional. This includes, but isn’t limited to hiring an attorney to make a will, trust or help with a divorce, going to the doctor for an ailment or immediate issue such as a broken bone, infection, or immunizations, hiring a real estate agent to walk you through the buying or selling of a home, or working with a financial planner to guide you on your investments, financial plan or other money matters.
Now, there are some people who will argue with me and say that some of these tasks and professions can be done without the help of a professional. I disagree. Granted there are plenty of do-it-yourself places for wills, trusts, investing, and medical care. But caveat emptor – buyer beware!
Some of these reasons why people will justify or rationalize doing it themselves would be to save money, trust issues or the fact that they think they can do the job just as well if not better than the professional. Some may get lucky, but many unknowingly choose a different fate. The reason I say unknowingly is due to the fact that they make the choices and often don’t realize the consequences until much later. Take for example the person that does their will online. They may not realize until much later (in the case of their death they won’t realize at all, but their kids will) that they made a mistake or the will wasn’t according to their state’s laws.
In a divorce, they might not realize that the settlement they got should have been much bigger or smaller than what they received or paid. In our business of financial planning, we’ve seen too many do-it-yourselfers try to play the stock market game by actively trading, watching cable news, and reading money magazines. I mean, if 10,000 Wall Street analysts can’t figure it out, these amateurs surely have an edge (I am of course being grossly sarcastic).
They key word to look at here is professional. What does it take to be one and what should we as consumers look for? Here are some basics to look for:
- Education – are they qualified and educated in their field? What degrees and designations do they hold?
- Tenure – how long have they been practicing?
- Licensing – are there state or federal standards needed for them to be in their profession?
- What don’t they know? – are they willing to admit when they aren’t qualified to help? Look at it this way, a general practitioner isn’t going to give you brain surgery. You’ll need a brain surgeon. Both are doctors, but both have very different professions and clients. Likewise, an estate attorney and a criminal attorney are both lawyers, but both have different expertise. Avoid people who claim to know everything.
- Code of ethics – do they adhere to one?
- Transparency – do you understand what they’re doing for you, how they’re doing it, and how they are getting paid?
This list isn’t the end all be all, but it can be a good place to start. The main point being is that when you hire a professional you’re hiring them for their expertise, experience and professional judgment. In your eyes, it’s worth it to you to delegate the job needed to be done, in exchange for your time and money. You’re willing to admit that you don’t know everything (a wise move, but admittedly hard to do) and are willing to trust a professional to guide you. In the long run, a professional will potentially save you, if not make you money depending on the job he or she is doing. They’ll be focused on your long-term well-being and committed to building a relationship with you. They’ll be open to your questions and may even ask you some thought-provoking questions as well.
In the end, working with a professional should ultimately allow you to delegate a task that you feel you’re unable to handle and ultimately will save you money in the long run by avoiding mistakes and saving you time and energy. Your homework is to find a true professional.