Despite all the commercials you see touting the importance of working with a financial planner, most Americans continue to manage their money all by themselves. And the truth is, for a lot of people, DIYing it can work out OK — until they’re closing in on retirement, that is, and need specialized help from a professional.Making the Switch: How to Transition Your Portfolio from Growth to Income
There are certain professions, however, that can (and should) benefit from getting advice sooner rather than later. Pro athletes and celebrities, of course, need assistance as soon as they make it big. But I’m also thinking of well-paid and busy professionals, such as doctors, lawyers and pilots.
If you’re a pilot, it may be unusual for you to see yourself grouped in with those other professions. But as a financial adviser whose office is near Chicago’s O’Hare Airport, I’ve learned you may have several of the same issues to deal with, along with other concerns that are unique to your being a pilot. And yet, many pilots are just winging it when it comes to their finances.
Here’s why that can be a bad idea:1. The airline industry is known for boom-bust cycles
Bankruptcies, bailouts, mergers and acquisitions are common in this competitive business and can affect your employment and benefits. So can external economic factors, like the stock market drop in 2008, and unexpected events, such as the 9/11 terrorist attacks and the COVID-19 pandemic.
Last year, Boeing’s then-CEO Dennis Muilenburg told CNBC that a growing pilot shortage was one of the biggest challenges facing the airline industry. This year, when COVID-19 caused a steep drop in consumer demand, pilots were being offered long- and short-term voluntary leave and early retirement packages. Because the job can be so unpredictable, preparation is a must. Having a financial plan in place, and an adviser who can talk you through the options, can help eliminate knee-jerk decisions.2. You may not be ready for mandatory age-based retirement
Plenty of pilots retire before age 65. Just as with other professions, many are ready to relax or try something new. But even if you keep working, not every pilot retires with buckets of money. If you got a late start on saving and investing — maybe because yo