Are you considering working with a financial planner but not sure what to expect? A financial planner is a professional who helps individuals and families manage their money, plan for the future, and achieve their financial goals.
Let's take a closer look at what financial planners do, how to find a good one, and what questions to ask in your first meeting.
What Does a Financial Planner Do For You?
A financial planner provides personalised advice to help you make smart decisions about your money. They can assist with a wide range of financial matters, including:
- Budgeting and saving- Creating a plan to manage your income and expenses
- Investing- Developing an investment strategy aligned with your goals and risk tolerance
- Retirement planning- Calculating how much to save for retirement and optimising your pension and Social Security benefits
- Tax planning- Minimising your tax liability through strategic financial moves
- Insurance- Assessing your insurance needs and finding cost-effective coverage
- Estate planning- Preparing wills, trusts, and other legal documents to protect your assets and provide for your heirs
Financial planners take a holistic view of your finances and help you see the big picture. And because they create customised plans based on your unique circumstances and goals, they offer a much more individualised approach to other options out there.
Is It Worth Seeing a Financial Planner?
While you can manage your own finances, there are many benefits to working with a professional financial planner:
- Expertise- Financial planners have specialised knowledge and experience with complex financial matters. They stay on top of ever-changing laws and regulations.
- Objectivity- It's easy to make emotional decisions about money. A financial planner provides an unbiased outside perspective to keep you on track.
- Time savings- Researching financial strategies and products is time-consuming. A financial planner can save you hours and help avoid costly mistakes.
- Accountability- A financial planner keeps you accountable and motivated to follow through on your financial plan. They provide ongoing support when life changes occur.
Studies show that people who work with a financial planner feel more confident and secure about their finances. While there is a cost involved, the value and peace of mind can be well worth it.
What to Check When Choosing a Financial Planner
Not all financial planners are created equal. It's critical to do your due diligence and choose a trustworthy planner. Here are some key things to look for:
- Experience- Look for a planner with several years of experience, ideally with clients whose situations are similar to yours. More experience is generally better.
- Credentials- Make sure your planner has respected credentials like Certified Financial Planner (CFP), or are members of Professional Associations such as the Profession of Independent Financial Adviser (PIFA) or Certified Independent Financial Advisers Association (CIFAA).These require rigorous training, adhering to Independence and continuing education.
- Fee structure- Find out how the planner is compensated. Fee-only planners charge a flat rate or percentage of assets, while commission-based planners earn money from product sales. Flat Rate is usually preferable to minimise conflicts of interest.
- Testimonials- Ask for references from current clients. Online reviews and testimonials can also provide insight into a planner's service and results.
- Compatibility- Ensure you feel comfortable with the planner's personality and communication style. You'll be working closely together, so finding someone you trust and connect with is important.
Beware of financial planners who guarantee specific investment returns, pressure you to act quickly, or seem more interested in selling products than understanding your needs. Take your time to find the right fit.
Questions to Ask a Financial Planner
When meeting with a potential financial planner, come prepared with questions to assess whether they match you. Here are some key things to ask:
- What is your experience working with clients like me?
- What credentials and education do you have?
- Do you have any conflicts of interest?
- How do you charge for your services, and how much can I expect to pay?
- What services are included, and how often will we meet?
- What is your investment philosophy and approach?
- Can you describe your typical financial planning process?
- How will you measure the success of my financial plan?
- How often do you communicate with clients, and what should I expect?
- What makes your firm different from other financial planners?
Listen carefully to the planner's responses and consider whether they take the time to understand your needs, goals and concerns fully. The right planner will happily answer all your questions and demonstrate their expertise and commitment to your success.
For example, at Allied Wealth, we make sure you fully understand the process and how we can help you along the way. We’ll always do our best to answer all of your questions and ensure you’re comfortable with the proposed strategy.
The Bottom Line
Working with a financial planner can provide valuable guidance and support to help you achieve your short and long-term financial goals. By understanding what to expect from the process, what to look for in a planner, and what questions to ask, you'll be well-positioned to find the right financial planning partner.
When you're ready to take the next step, consider working with an experienced and trusted firm like Allied Wealth. Our team of independent financial advisors specialise in wealth management, retirement planning, and business financial advice to help clients build and protect their hard-earned money. Schedule a no-obligation consultation to learn more about how they can help you achieve financial success.
Looking for an aged care financial advisor? We can help with that, too!
