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What Do Financial Planners Do?

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What Do Financial Planners Do?

Set your goals

Once you decide on a planner and agree on how he or she will be paid, your financial planner will begin working on your financial plan. Before the financial plan can be made, your planner will look at your current financial status. Come prepared to share all of your financial information with your planner. At this time, you will also set your financial goals and the timeframe for meeting these goals.

Things To Know

  • Be prepared to share all your financial information with your planner.
  • Your planner will recommend courses of action for you as well as a way to regularly evaluate your plan.

Recommending courses of action for you

Once the planner has reviewed and analyzed your current financial position, he or she will have a better idea as to what you must do to help reach your goals. The planner will recommend financial strategies to help get you where you want to be. He or she will revise the recommendations based on your feedback.

Following up on your plan

The next part of the process is to decide how the planner’s recommendations will be carried out. For example, if the planner says that you should save 20% of your money in stocks, he or she might next help you decide which stocks or mutual funds to buy. If the planner has the proper licenses, he or she may carry out these services themselves, or help you coordinate with stockbrokers, insurance agents, etc.

The last part of the planning process is to regularly evaluate your plan. Monitoring the success of your plan might be the responsibility of your planner, you, or both you and your planner together. After evaluating your plan, new recommendations will be made by your planner if necessary.

Our life goals will change as we get older. A good financial plan and planner will recognize that, and so he or she will help you change your plans as needed. For example, if you are in your 20s, your plan might focus on paying off debt and starting a family. Once you are in your 40s, though, you might find yourself needing to save money for retirement, take care of an elder, pay a mortgage, or fund some other goal that was not as urgent when you were 25. A good planner will help you plan for the goals you have at any age. This might involve changing the investments that you hold in order to make them either more aggressive or more conservative. You will get the most out of your financial planner if you understand his or her responsibilities and specialty areas, and if you come prepared with the information your planner will need to help you.