Industry Tips
Financial Planning Services
Many people, who would like to invest, complain that they never have enough money. Financial planning can help consumers overcome this. The establishment of investment goals and suggesting direction to help meet these goals is the job of an effective financial planner.
While financial planners can help you every step of the way, the first steps can best be done on your own.
First, decide what your goals are and set personal deadlines for working on them. These goals may seem at first unattainable but if you examine them, you'll be able to refine and modify them into a workable plan.
Second, track income and expenses until you develop an understanding of annual income and outgo.
Third, list all assets including home value, life insurance investments, savings accounts, pension or 401 K plan, and Social Security account. Then list all liabilities including mortgage, personal, and credit card loans. The difference will be your approximate net worth.
Fourth, begin work on a budget. Consider: Are your goals worth driving an older car? Are you shopping for the best prices? Are there any unnecessary expenses? What is your financial security worth?
With this done, you'll be in an excellent position to evaluate financial planners. Be sure to look for someone that can meet your various needs, and be weary of someone just pushing one specific financial product. Also consider the following questions. Do they provide a clear, easily understandable plan? What are the risks? What options are there to shift investments because of inflation or a changing market? How much money can you reasonably expect to have for your goals like college education or retirement? Can you access your money in case of emergency? What options, such as payroll deduction, are available to make investment a routine?
Financial planners work on a fee only, commission, or combination basis. Financial planning is an industry that is not federally or state regulated. However, there are independent associations with their own set of standards that offer membership to financial planners. You can check with your financial planner to see if he/she has any such memberships. You can ask your attorney, insurance agent, or accountant for a referral to a financial planner as well. When choosing a financial planner the BBB suggests interviewing 3 potential advisors in person and asking for a written disclosure document
