What's TRUE Financial Planning?

In this blog, I want to shed a bit of light on what we, as financial planners, ACTUALLY do.  I promise to try to keep it interesting and I promise not to try to sell you a pension!...

Reputation?  You must be Joking!

You might think of us as 'financial advisers' or 'IFAs'.  These terms don’t, in my opinion, conjure the most positive of sentiments.  There's an old school 'insurance salesman' feel to them.  Watch out or they'll try to sell you something!Back in the day, commission was the way most of us were paid and this was never going to lead to the most equitable of relationships between client and adviser.  If you bought a product, HOORAH, we got paid.  If you didn't buy a product, BOO, we didn't.  Not very professional was it?If it's a car or a computer or even a house, commission is a fair enough way to be paid but these are one-off transactions but what I’m talking about here are financial products that could be with you for decades.  They could have a major impact on your future financial security.  It's serious stuff and, surely, there's a better way…

How Does It Work Now, Then, Marco?

I can only speak for my own business, although I know this is happening in many firms up and down the land.  The thing is, I'm simply not interested in financial products at the start of a new relationship.  In fact, I'm not particularly interested in them at any point during a relationship!Financial products (investments, pensions, insurance, mortgages, etc.) are a necessary part of the work we do but they are simply tools to get a job done, nothing more.  What's important is knowing what job they need to do in the first place!If I met you for the first time, I’d like to get to know you and I’d like you to get to know me.  We’re human beings, first and foremost, and we need to connect on a human level before anything else can happen.Sometimes this doesn't happen.  We’ve all been in situations where we've met someone, and the chemistry just isn't there.  Something about them (or us) isn't clicking and it becomes all too much like hard work.  We could be working together for years so it's important we like each other and get on.What makes you tick?  What are your values?  What are your fears?  I ask lots of questions and I’m really interested in your answers. Some conversations aren't easy but they're important if we’re going to get to the bottom of things and develop an understanding of your needs and wants.Clients say to us that they find the initial meeting of great value, simply because they're given space to express how they feel, safely and without judgement.

The Work

After we've met and (hopefully) had a really lovely conversation, we'll decide if we can (and want to) work with each other.  If that's the case, I'll set out exactly what we'll do, what the benefits are and what it will cost.  No fuzziness at all.  I find people appreciate that.I and my team will then go away and do the work we've agreed.  I’ve no intention of boring you with what that work is but it's important and helps us deliver results.  Frankly, it’s the part of our work you're probably least interested in.  You're likely to be most interested in the next part of the process, though!

The TRUTH About Money

So, a few weeks later, we get together with you again.  I'll show you, through easy to follow projections, what your financial life will look like in the future (based on some assumptions).  You'll see your money come to life!All the things you told me were important to you will be factored in to these projections, so you'll be able to see the impact of them easily.  We'll also chat about 'what if' scenarios and change things there and then so you can see if you can take that round world trip or help the kids out with deposits, etc.This is all moving towards building a plan for you.  A plan of action that will help you get to where you want to.  It will be clear and understandable, so you'll find it incredibly useful.  If there's technical stuff, we'll try to protect you from the jargon and translate things in to terms normal people can understand!

It Might Not Be Good News

Of course, we want all our clients to have enough money to do the things they want to.  We want their money to outlive them and not the other way round, but this isn’t always the case.  There may be a gap, but I'd rather be honest, and show you the TRUTH about your money.  You have a right to know.If there are shortfalls, you'll have some options which could be to reduce the size of the lifestyle you want (not good), work longer (still not good) or try to earn / save more (could be tricky).  Whatever the position, we'll help you.There might be things we can do with your financial arrangements which could help to make things more efficient (tax, cost, flexibility, etc.) and, if we think that will help you, we'll tell you what they are and what's involved.

Staying the Course

So, you've got your plan together, but I guarantee it will be wrong from the get-go.  That's because life's unpredictable.  Things inside and outside your life will change, often dramatically.  Your plans and dreams will evolve and who knows what investment markets will do.We need to review things regularly, so you always have clarity about your financial future and what it will look like.  A plane is off course most of the time.  The pilot makes constant, minor changes to make sure the plane lands in the right place.  That's sort of what we do.

The End

So, does what I've talked about sound like what you'd expect from a 'financial adviser' or an 'IFA'?  I hope not.  Have you noticed how little I talked about financial products?  They're important but not THAT important.The process is all about YOU and we deliver it with care and thought.  It's important to us that you get the results YOU want out of our relationship.  If you don't, then there's no relationship as far as I'm concerned.Thanks for reading.  Feel free to share this little effort if you think they'd benefit from reading it.Speak soon…