When you’re feeling stressed about money or have a lack of direction, who do you go see for advice?
Is it your aunt Patty who won the lottery? Perhaps it’s your friend Rick who seems to have a thriving business. Still, it might be your favorite television personality who has been advising for a few years.
While you might receive some good advice from these sources, the question of experience comes into play. Instead of seeking financial advice from family, friends, or television personalities, I would recommend you seek out the advice of a financial planner.
What’s a Financial Planner?
What’s a financial planner? Well, a good financial planner is someone who has significant experience helping individuals and families make short-term and long-term financial plans. Pretty straightforward, right?
Unfortunately, there are financial professionals out there who seem to be financial planners, but really aren’t. You see, many financial professionals are what are called financial advisors. Financial advisors typically sell investments and, well, that’s pretty much it. Sure, there might be some planning involved in selling investments, but if you want the works, go with a financial planner.
Responsibilities of Your Financial Planner
You should expect your financial planner to live up to their responsibilities, and there are several of them. Let’s take a look at some of these important responsibilities.
1. Financial planners should stay current on financial news.
In order for a financial planner to help their clients, they must stay up-to-date with with the latest financial news. They should know what’s happening in the markets and thoroughly understand tax law as it relates to your financial needs. Additionally, they need to educate themselves on the latest financial products and services.
For example, at Strategic Income Group, we set aside a week during which a number of investment managers visit our office to make presentations on their firm’s views, research, and investment products. This is just one way we stay up-to-date for our clients.
2. Financial planners should listen attentively to your needs.
When you sit down with a financial planner, they should always listen attentively to your needs. They should never be quick to make a recommendation and should understand the big picture before they start giving you advice.
Your financial planner’s objective should be to consider the whole of your finances, not just the areas that might benefit their paycheck.
3. Financial planners should help you set goals based on your needs.
Once you’ve shared everything with your financial planner, they should outline all the goals you should reach and how to do so. For example, they might recommend getting on a budget, purchasing appropriate insurance policies, and saving for retirement.
Everyone’s needs are different – the advice financial planners provide should be customized to your financial situation.
4. Financial planners should proactively monitor and manage your accounts.
Financial planners should be proactively monitoring and managing your accounts such as your Roth IRA or your insurance policies.
For example, if you recently told them that your income increased, they may recommend that you increase your life insurance coverage.
5. Financial planners should meet with you on a continual basis.
Change happens. Financial planners can help you put a long-term plan in place, but sometimes life’s circumstances change and therefore so should your financial plan.
That’s why it’s vital to sit down with a financial planner at least once per year to update them on changes in your life. Additionally, financial planners should proactively reach out to you to set up these meetings – they should care about meeting your needs every step of the way.
By the way, do you know if your financial planner has lived up to expectations? You can find out by using BrokerCheck by FINRA. Give it a shot!
What do you expect from your financial planner? Leave a comment below!