Investment Basics

Many individuals opt to work with financial planning professionals without fully understanding what a planner can help with and what they cannot help with. Knowing ahead of time what a planner can do will not only help you to avoid disappointment when meeting with a planner but will ensure that your planner is actually doing the most he or she possibly can.

What a Planner Will Do

In its most basic form a job description for a financial planner will state that he or she will provide guidance and recommendations that will help you achieve your financial goals. The planner will use a variety of tools to do this and therefore will also need a lot of personal, sometimes intangible information.

Common Goals

Some of the most common goals that people will have is to retire with an abundant amount of money, protect their financial assets and family in the even of an accident, help finance a child's education and so on. The personal information that the planner might ask for will be things like "what does an abundant retirement look like? How much have you saved, how much can you save and how much risk are you willing to take." Such questions allow the planner to determine a dollar figure (e.g. retiring with $250,000 in savings might enough for some, while $2,500,000 in savings could be insufficient for others) which allows them to present an appropriate strategy (the "plan") to get there.

More Personal Questions

Although it may seem inappropriate or the answers could be embarrassing, the planner is very likely to ask about your health, especially when building a protection plan that involves insurance products. However, health is also an important factor in helping to determine a statistically likely life expectancy (you may think you will only need save for 20 years of retirement but given today's longer life expectancy rates, you may actually need to save for 30).

What a Planner Will Not Do

Unfortunately, a planner is not about managing your budget or personal finances. In its most general form, the planner is about putting a plan together that will help you achieve your goals. If you want to save to purchase a new home, the planner can tell you how to get there, but cannot physically provide you with a weekly allowance to ensure that your plan stays on track. Of course, the recommendation and plan will exist, but the discipline is always up to the individual, not the planner.

Is It Worth It?

Without question, most people can plan for their own futures and put the programs in place to achieve their financial goals. However, a planner will most likely be up to date with specific taxation, retirement, insurance and borrowing legislation, requirements and strategies, making it well worth anyone's time to at least sit down with a planner and see what kind of value they can offer your plan.

Chris has more than 17 years of financial services. He currently manages a website about Kingsdown Mattresses as well as half a dozen other types. You can visit the website at QMattresses.com, regardless of whether you are interested in Kingsdown Mattresses or other types of mattresses.