In reality, a financial plan is a holistic analysis of a person’s
current financial situation and their short- and long-term goals –
with strategies and an action plan to achieve them. That is where a
financial planner can be your guide through the forest of options to
help create a realistic understanding of where you are at, where you
want to go, and how to get there.
A financial planner does not replace your other trusted advisors,
like your accountant and lawyer. On the contrary, a financial planner
is another part of your team to ensure you can achieve your goals.
To start, a financial planner would usually schedule a discovery
meeting to get to know you while reviewing the following information:
- Family structure and dynamics, areas of concern with family
members, and identifying important people in your life to include in
the financial plan.
- Short- and long-term goals and dreams
you want to achieve.
- Current issues and problems that need
- Bank accounts, investment accounts, real estate, and
other personal assets.
- Existing retirement savings,
pensions, employment benefits, and life insurance policies.
- Sources of current and future income.
- Recent tax
- Liabilities, including mortgage, vehicle or other
loans, lines of credit, and credit cards.
monthly/annual budget vs. income to understand your current
situation and to identify potential cash surpluses.
- Personal and family health history and whether strategies need
to be put in place to support health costs or obligations.
- Wills, powers of attorney, personal directives, and estate
- Business growth and succession planning,
- Corporate financial statements, corporate tax
returns, and unanimous shareholder agreements, if applicable.
In planning for your aspirational future, key areas of a financial
- Retirement and cash flow planning
- Savings for
children or family
- Tax planning
- Philanthropy, and
- Estate planning.
Taken together this becomes your map of where you are and how to get
to where you want to be. The next step is to work through options and
strategies to create a realistic, achievable plan for your future – to
protect yourself and the significant people in your life, and to
achieve your goals.
As your life situation changes, so should your financial plan. A
financial planning update is like checking a compass to make sure you
are still heading where you want to go. It is recommended that you
review and update your plan whenever you have a major life event, or
about every three years, to test assumptions and results, and revise
as needed. Another key time is when you begin to contemplate retirement.
Having a financial plan and reviewing it regularly enhances the
probability you will achieve your financial goals at all stages of
your life. Clarity on a course of action and peace of mind knowing you
are doing the right things are some of the advantages of working with
a financial planner.
This blog provides some basic information to help you prepare for
your planned financial future. Contact us to develop your own
financial plan and help you reach your financial potential.