Choosing a Financial Planner
As with most entrepreneurs who've built their own business, and many other successful people, there is a belief that people should be able to handle their own personal finances, make their own decisions, and implement them by themselves.
Do I really need a financial planner?
I could provide you with a laundry list of ideas why I think people need one, but I'll use an analogy instead. We go to the doctor for regular medical checkups. We go to the dentist to ensure our dental health. We take our cars in for regular tune-ups. Why? Preventive maintenance. We use the skills of professionals in order to make sure these aspects of our life run smoothly because we don't have the expertise to do it all ourselves.
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So when it comes to personal finance, why wouldn't we call an expert? Someone who understands the problems and issues, has seen it before, and can recommend a course of action. Not only that, but they can help you implement it, and if required will follow-up to ensure the solution is working as well as it should. All the best athletes on the planet have coaches. Why? Discipline, encouragement, instruction, feedback, teamwork, dedication, and they help the athlete maintain their focus. A good financial planner does the same for their clients. |
While people do not hesitate to hire experts in other areas of their life, hiring someone to help with money and finances can make people feel like failures. The world of personal finance is complex to navigate - investment options, taxation issues, wills and estate planning, goal setting, dealing with debt - there are no shortage of issues that financial planners help their clients deal with.
Perhaps the key component that a financial planner brings to the table for a client is objectivity - helping a client come to grips with where they are financially. Once that is done, their ability to educate and manage a client's expectations aids in charting a course of action to build a better, more financially secure future.
Once an individual or couple can answer 'yes' to the "do I need" question, it leads to the next question.
Perhaps the key component that a financial planner brings to the table for a client is objectivity - helping a client come to grips with where they are financially. Once that is done, their ability to educate and manage a client's expectations aids in charting a course of action to build a better, more financially secure future.
Once an individual or couple can answer 'yes' to the "do I need" question, it leads to the next question.
How does one hire a good financial planner?
I don't believe there is a set answer for this, but here are questions I would suggest you ask and feel comfortable with the answers you receive before you consider hiring anyone.
Click on each question below for the answer: (re-click the question to hide the answer when done).
Click on each question below for the answer: (re-click the question to hide the answer when done).
There are probably dozens of other questions that you could and will ask, but I think that these are my top five. Before you speak to any prospective financial planners (and I do recommend that you speak to more than one) it will help if you've done your homework as well. Have some idea of what you want to accomplish and be able to articulate your goals. Referrals can be useful. Who do your friends and family use? Are they satisfied with their level of service, quality of the plan that was developed, and the investment advice they receive? If so, that is a great place to start.
Hiring a financial planner can be a scary thought for many people. In order to build a complete and comprehensive plan, a planner will have to become familiar with your entire financial situation. This means that you have to be comfortable with your planner and willing to share personal information with them. They have to understand your dreams and goals. The thought of discussing that much personal information with a 'stranger' can scare people. Please don't be intimidated. Financial planners aren't there to pass judgment, they exist to help you attain the goals you want for yourself and your family. You are responsible for your part in the planning process; nobody will care more about your money than you will.
Lastly, it's not a contract for life. You are free to terminate a relationship with a financial planner whenever you wish. I suggest that you not do that lightly, but if your needs are not being met, if you are unable to attain your goals, if you feel your planner is no longer listening or meeting your expectation - don't hesitate to change. After all, it is your money, your goals and dreams that are important. Peace of mind with the people who are helping you in the process plays a major factor.
I hope this information has been useful.
Hiring a financial planner can be a scary thought for many people. In order to build a complete and comprehensive plan, a planner will have to become familiar with your entire financial situation. This means that you have to be comfortable with your planner and willing to share personal information with them. They have to understand your dreams and goals. The thought of discussing that much personal information with a 'stranger' can scare people. Please don't be intimidated. Financial planners aren't there to pass judgment, they exist to help you attain the goals you want for yourself and your family. You are responsible for your part in the planning process; nobody will care more about your money than you will.
Lastly, it's not a contract for life. You are free to terminate a relationship with a financial planner whenever you wish. I suggest that you not do that lightly, but if your needs are not being met, if you are unable to attain your goals, if you feel your planner is no longer listening or meeting your expectation - don't hesitate to change. After all, it is your money, your goals and dreams that are important. Peace of mind with the people who are helping you in the process plays a major factor.
I hope this information has been useful.
