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Financial Planners – What do they do?

Financial Planners – What do they do?. Financial Planning Mr. Yates. What do they do?. A financial planner is like having a personal coach for your money. 

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Financial Planners – What do they do?

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  1. Financial Planners – What do they do? Financial Planning Mr. Yates

  2. What do they do? • A financial planner is like having a personal coach for your money.  • Their aim is to help you protect and get more out of the money you have, so you can have more of the things you want – today and in the future.

  3. Financial Planner • After finding out who you are, your current circumstances and where you want to be, • your financial planner will help you make informed decisions about how to make the most of your money, • investing and protecting it to your advantage and using financial products that suit your needs.

  4. With the background  Plan • summarize the client’s financial position • list their goals • explain how they will reach those goals • show how carefully chosen investments mesh together as working parts of an overall strategy • disclose and explain any risks and how they can be overcome • state all the costs • reveal the commissions the financial planner might receive from the investments they recommend. 

  5. The First Meeting… • At the first meeting, a financial planner will ask the client about themselves – about where they are now, about their expectations, about how they would like to live their life. • Then they will conduct something called "fact finding" - they will ask about their personal circumstances and help them to determine your attitude towards risk. • Your attitude to risk means whether they are conservative in the way they invest, aggressive or somewhere in between.

  6. Financial Planner Needs • Don’t be surprised when a financial planner asks for detailed personal information; they need it to put together a financial plan. Hence, they will ask things like a client’s: • age • current personal income • family income • future income (inheritances included) • day-to-day expenses • your family circumstances (number and health of dependants, dependants from previous relationships etc) • future expenses • assets and liabilities • tax paid and tax owed • insurance situation • current investments • state of health.

  7. More… • A financial planner will also need to have considered the client’s goals and current financial position. Financial planner will ask you things like: • when they want to retire • how they want to educate their children • whether a second home, like a vacation home, is important • do they have dependents they need to provide for if they are unable to work or if the unforseen happens • whether they have an up-to-date will • whether they are expecting any large expenses.

  8. How do they get paid? • Many advisers get paid through commissions on investments they recommend. • (The law allows this, as long as the client knows about it.) • Only a few advisers charge simply by the hour, but the client may be able to negotiate this arrangement. • Most charge a combination of fees and commissions.

  9. Financial Planner Fees • As a rough guide, if a client invested about $100,000, they should expect to pay from $1,500 to $2,500 (or from 1.5% to 2.5% commission, • or $15 to $25 for every $1,000 you invest) for the normal range of products, assuming their finances are reasonably straightforward. • Fees for service can range from about $100 per hour to $400 per hour. • Around $200 an hour is common if they are paying only for the time spent and no commissions.

  10. Questions asked prior of FP’s • They include questions like: • Is the planner licensed or do they represent a licensee? • Do they have experience in advising clients with similar needs? • What products can they advise on (ask to see their Approved Products and Services list)? • What qualifications do they have? • What processes do they follow? • What are their professional development plans? • What are their fees?

  11. How they become FP’s • In addition to completing courses that cover the financial planning topics required for CFP® certification, a bachelor's degree (or higher), in any discipline, from a regionally-accredited* U.S. college or university** is required to attain CFP® certification. • The bachelor's degree requirement is a condition of initial certification; it is not a requirement to be eligible to take the CFP® Certification Examination. • After you pass the CFP® Certification Examination, you will be required to provide evidence (photocopy of degree) that you hold a qualified bachelor’s degree or higher degree.

  12. In addition… • There is a focus of study for financial planners in: • General principles of financial planning • Insurance planning and risk management • Employee benefits planning • Investment planning • Income tax planning • Retirement planning • Estate planning

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