Financial Planning 101: Do I Need a Financial Plan?

When it comes to managing your investments and achieving your financial goals, you don’t want to make mistakes. You may need assistance and want to hire a financial advisor. A financial advisor can help you map out your financial future, find the best ways to pay for college, help you plan for retirement, provide estate planning, as well as other financial goals.

Not everyone needs a financial advisor, but having this extra help can be beneficial in reaching your financial goals.

Reasons to Seek Financial Planning Assistance

Life Events

Graduating college, getting married, getting divorced, having children, nearing retirement, death of a spouse, or starting a business are all major life events that may prompt you to reevaluate your financial situation and seek professional guidance.

Lack of Experience

A financial planner can help you understand concepts and strategies that you are not familiar with.  Getting the extra assistance and personalized help can make a big difference in achieving financial security.

Strategy Development

A financial advisor can help you prioritize your financial goals and help you develop a plan to achieve them.  Whether you have one main goal, or several, a financial advisor can guide you through the process.

Financial planning can help you reach your goals throughout your life—whether you want to buy a house, save for your kids’ college, live a fulfilling retirement, leave a legacy for your children, or make a difference for a charity. Your goals may evolve over the years as a result of shifts in your lifestyle or circumstances such as an inheritance, career change, marriage, purchasing a home or having a child.  Whether you’re looking for help with a particular financial need or a more inclusive roadmap for your future goals, a financial advisor can help you build confidence in your financial situation today, and plan for a more secure tomorrow.

What is a Financial Plan?

A financial plan can help you set your financial priorities when you have competing needs for limited money, such as balancing saving for your kids’ education costs while trying to save for your own retirement. Planning can also help protect your family from the unexpected. A financial plan will  help you worry less about market downturns, emergency expenses, healthcare, and long-term care costs, or outliving your retirement income. You can stretch your money when you work with a professional who is trained to show you how to choose investments for your timeframe and risk tolerance, save money on taxes, and rein in high-interest debt.

Meeting with a financial planner and developing a financial plan may be a one-time event or an on-going relationship, depending on your needs.

How to Prepare for Meeting with a Financial Planner

Create a List of Issues for Discussion

You may have a specific reason for seeking advice, or you may want general advice.  Making a list of topics to discuss will keep you focused and prevent you from forgetting items you want to address.

Create a List of Questions

Review the list of topics you want to discuss and note specific questions you want to ask. For example, if one item is retirement, a question might be how much you should save each month, or how it should be invested.

Gather Financial Documents to Share

Bringing your current investment and retirement statements, as well as your current tax return, to the initial meeting is helpful.  Ask the advisor what documents you should bring. The advisor may also send you a questionnaire in advance of the meeting to gather important information needed.

If you don’t have the time or expertise to deal with your finances, you are not alone. Financial decisions can be emotional, complex, and demanding. Having a professional develop a financial plan can provide peace of mind, knowing you are on the right track to your financial goals, or providing solutions to help you achieve those goals.

Next week in part two, I will focus on choosing a financial planner.

The information contained in this article is provided for informational purposes only and is not intended to substitute for obtaining accounting, tax, or financial advice from a professional for your specific situation.

Filed under: Dollars & Sense, Life, News
Profile photo of Penny Wasem, CPA, CFP, PFS, owner of Lifetime Financial Planning Solutions in Lancaster, Ohio.

By Penny Wasem, CPA, CFP, PFS

Penny L. Wasem is the owner of Lifetime Financial Planning Solutions, LLC. A summa cum laude graduate of Ohio University, Penny earned a Bachelor of Business Administration with focus in accounting and mathematics. She serves on the board of The Fairfield Medical Center Foundation, is a member of the Investment Committee of The Fairfield County Foundation and has been active on many non-profit boards in the community. Penny lives in Lancaster with her husband Eric Hubbard and is parent to Clark and Olivia Hubbard.