What should a good financial planner be doing for you?

A good financial planner needs to get to know you really well. It is essential that they get to know you first and get to know your money later. Going straight to the money is like a doctor putting his glove on before you tell him what is wrong.

Most decent financial advisers get to know the hard facts; your income and expenditure, assets and liabilities. But a good financial planner will want to know a lot more about you, your family, your history, what you want to achieve – and when. They should aim to understand your current and desired lifestyles – in a future article we’ll consider the main components of your lifestyle.

Understanding how your money will flow through your life is essential. This can be a very intimate and personal experience; hence they need to consider the chemistry between you – discussed in my last article which you can find at lambandassociates.co.uk/blog. Once they understand you, they can then consider how they can help you achieve your lifestyle with the resources you have available.

You should expect this to be done, effectively using a set of accounts, including a net worth statement, income and expenditure statement, tax calculations and cash flow projections. When these are prepared, you will be ready for a planning meeting. The planning meeting should discuss the assumptions made (eg life expectancy, inflation, rates of return) and it is essential that you have confidence in the assumptions. If not, you cannot have confidence in the outcomes. When you understand where you are and where you are heading without any planning, you will be ready to plan your future.

What your planner should not be doing is doing your planning for you; it is unlikely that you will buy into it and therefore not commit to it. Financial planning works well when you work with your planner. To get best results, you should do your own planning, with your planner merely facilitating the meeting and using their skill and experience to guide you. They should also be there to think outside the box when necessary. A good financial planner should be working with you to help change your life. That’s value for money!