What's important to you? Do you imagine yourself owning a new home, starting a business, or retiring comfortably?
What does it cost?
That's where financial planning comes in. Financial planning is a process. By evaluating your finances and outlining strategies tailored to your personal needs and available resources, you can implement a plan to achieve your goals.
Here is a list of some common financial objectives.
Financial planning is important.
A comprehensive plan serves as an agenda for the various factors involved in your personal finances. With a plan in place, you'll be able to focus on your goals and understand what it will take to achieve them. One of the main benefits of having a plan is that it helps you balance competing priorities. A financial plan will show you have your goals are related. For example, saving for your children's college education might affect your ability to save for retirement. You can use information that you glean in the process to decide how to prioritize your goals, make decisions, and implement strategies. Best of all, you'll have peace of mind that comes from preparing for critical life events.
Financial planning is a process.
Preparing and implementing a comprehensive financial plan generally involves working with an independent, fee-only advisor to help you complete the following projects.
Organize your advisory committee.
You are the most important member of your financial team. Your needs and objectives come first. The other members of your team support you and your financial goals. Your advisor helps with the overall process, consulting with you, helping you set goals, develop a personal financial plan, and coordinate with other professionals who have expertise in specific areas. For example, your accountant helps with tax issues and your attorney helps with matters of law.
The financial planning process doesn't end once your initial plan is implemented. Generally, your plan should be reviewed at least once a year to make sure that it's up-to-date. It's possible that you'll need to modify your plan due to changes in legislation, the economy, or your personal finances. Here is a brief list of events that might trigger a review of your financial plan.
Here's a handful of common questions (and answers).
Question: Why can't I do it myself?
Answer: You can. If you have enough time and knowledge, then you can develop a comprehensive financial plan. However, you may require advice or assistance. A fee-only advisor can furnish objective information to help you weigh your alternatives. This saves you time and money in the end. And, it ensures all angles of your financial plan are covered.+
Question: What if I'm too busy?
Answer: Don't wait until you're in the midst of a crisis before starting the financial planning process. The sooner you start, the more choices you have.
Question: Is the process complicated?
Answer: A personal financial plan is tailored to your needs and objectives, so how complicated the process really is depends on your unique circumstances. However, no matter what type of help you need, an independent, fee-only advisor will work hard to make the process as easy as possible, and will gladly answer all of your questions.
Question: What if my spouse and I disagree?
Answer: An independent, fee-only advisor is trained to listen to your concerns and help you find common ground with solutions tailored to your needs, objectives, and values.
Question: Can I still control my own finances?
Answer: Yes. You control your own finances. An independent, fee-only advisor makes recommendations based on your needs, objectives, and goals. He helps you make decisions. You decide which recommendations to follow, and your advisor works with you to implement and monitor them.
To find out more, email Chris here.
Chris Bryant is an American financial advisor.