As a financial planner, I've seen firsthand the transformative power of a well-crafted financial plan. Regardless of what your career is or what your goals are, smart financial planning is a must.
I’m David Smart, an independent financial adviser in NZ, and I specialise in helping my clients expertly handle their finances. In this article, we'll delve into the importance of planning your finances and what it takes to craft an effective plan.
What Makes A Good Financial Plan?
An incredible financial plan can provide you with peace of mind, help you plan for expenses and overall reduce financial stress. Let's break it down into its essential elements:
Simple And Easy To Understand. First and foremost, your financial plan should be straightforward and easy to grasp. Financial jargon can be intimidating, so I strive to keep things clear and concise. After all, you shouldn't need a degree in finance to understand your own plan.
Easy To Implement, Administer And Monitor. A good financial plan should seamlessly integrate into your life. It shouldn't require you to jump through hoops or spend hours poring over paperwork. Instead, clever financial planning should allow you to manage your finances without too much hassle.
Tailored To Your Specific Circumstances. No two individuals are alike, so your financial plan should be customised to fit your unique situation. Whether you're saving for a house, starting a family or planning for retirement, I'll tailor a plan that aligns with your goals and aspirations.
Designed To Achieve Your Objectives. At the heart of financial planning are your objectives - the things you want to accomplish in life. Your plan should be designed to help you reach your goals.
Credible And Robust. A good financial plan is built on a foundation of credibility and robustness. I use realistic assumptions and cover bases to mitigate any potential risks or setbacks.
Capable Of Easy Review. Your circumstances can change, so a financial plan that was great a year ago may not be so suitable now. Your plan should be easy to review so we can alter it as needed.
The Financial Planning Process
I follow a six-step advice process endorsed by the International Financial Planning Standards Board. It's a tried-and-true framework that ensures we cover all the bases and leave no stone unturned.
1. I Disclose Sufficient Information So You Can Make An Informed Decision. I believe in full transparency when it comes to my services. That's why I disclose all the information necessary for my clients to make informed decisions about working with me. Before any commitments are made, I provide a written Disclosure Statement in advance of our initial meeting. This meeting is entirely free and carries no obligations.
During this meeting, we’ll explore the FACT FIND and drill down into your objectives and more. If you wish to work with me, we’ll establish a written Scope of Engagement and agree upon a fee.
2. I Gather Information About Your Situation. Once I have a clear picture of your current financial and personal situation, I proceed to analyse the information gathered. I use a template FACT FIND and relevant Risk Profile documents to ensure all pertinent details are uncovered and recorded. Depending on the agreed Scope of Engagement, additional information may be requested.
3. I Will Analyse Your Situation. The analysis phase is where the magic happens. I review your current financial situation, taking into account various factors such as ongoing employment or business conditions, changes in the economic environment and foreseeable personal circumstances. This analysis allows me to identify gaps between your objectives and your current situation.
Based on this analysis, I draft a strategy with recommendations aimed at closing the identified gaps. The plan is supported by appropriate models, comparisons, calculations, quotes and research to ensure its credibility and effectiveness.
4. We Organise A Review Meeting. Following the draft presentation, we organise a review meeting to discuss the analysis and recommendations. Any changes or adjustments you request are recorded in a final analysis. Once you are satisfied with the proposed plan, I will prepare a Statement of Advice summarising my recommendations based on the analysis, review meeting and final analysis.
I believe in fair billing practices, so you will not be billed the agreed fee until you are completely happy.
5. I Help Implement Recommendations, If Necessary. If needed for effective financial planning, I also assist in implementing the recommendations, providing relevant paperwork, third-party applications and disclosures. After the implementation phase, I initiate follow-up phone calls following the Statement of Advice to ensure the implementation is proceeding as expected.
6. We Agree To A Review Period And Process. We also agree on a review period and process to monitor progress towards your objectives and make any necessary adjustments along the way.
Achieve Financial Confidence With My Financial Planning Process
Financial planning is not just about simple numbers - it's about crafting a roadmap to help you achieve your dreams. A good financial plan can provide the guidance and peace of mind you need to navigate life's financial journey with confidence.
If you're ready to take control of your financial future, I, David Smart, am here to help. Let's work together to craft a plan that's tailored to your unique circumstances and goals. Your roadmap to success starts here with clever planning and professional support.
To get in touch with me, you can easily call me on +64 27 543 4455 or use my contact page.
Move towards your financial goals with confidence; consider working with me, David Smart.