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How To Work with a Financial Planner

January 10, 2012

how to work with a financial planner

After a decade of financial ups and downs, most people are dumbfounded at what their financial position looks like right now. Retirement accounts are either non-existent or seriously depleted, the possibility that Social Security will be around in 10 or 15 years is nearly 0% and the cost of education and healthcare are on the rise. Let’s face it, it’s been a rough century so far, and now it is time to stop, regroup and to create a new financial strategy with the help of a financial planner. The following questions are what you need to ask your financial planner when you first meet with him or her.

What Services Do You Offer?

When you first meet with your financial planner you need to ask him or her what services they do and do not offer. This will help you to determine what type of help they can offer you and what financial planning help you will need to seek elsewhere. For example, your financial planner may be able to offer you life insurance and investment advice and services, but not cash flow management services.

How Do You Assess Fees or What Fees do You Charge?

This is a critical question to ask upfront so you are not surprised down the road. Financial planners can charge fees for any of the service that they offer, including hourly advising meetings, commissions and flat rate fees for account management, among others. Have your financial planner/advisor provide you with a hard copy of their fee schedule. Keep this schedule with your financial documents.

What Are My Options?

As you talk with your financial planner and give him or her the breakdown of your current situation and your future financial goals, make sure you ask what all of your options are. Do not just take their first recommendation. For example, if you are thinking about whole life insurance also ask if it would be better to purchase term life, which is less expensive, and to invest the difference in something else. Your financial planner can run the numbers and show you which option will produce the best end results.

Are My Goals Realistic?

Your financial planner and/or advisor is your expert to turn to for advice and for guidance, therefore they are your anchor to what is possible. They also can be your source of reality. If your financial goals are unrealistic for your investment style then they will tell you. When they say your goals are unrealistic for your investment strategy and style, then you can ask what you need to change in order to make them realistic. You can then make the adjustments needed, to your investment strategies or your ultimate financial goals.

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