| A friend asked this question- "When would I need a | | | | strategies for resolving problems, taking steps |
| financial planner?" and I thought is was worth | | | | toward your goals and/or answering your questions. |
| exploring with you. | | | | If the advisor was really listening, the plan should feel |
| If you wake up with a toothache or a painful, maybe | | | | sensible and doable, maybe even exciting. It is |
| contagious rash, you know you need to call a doctor. | | | | exciting to feel we are on a path that can lead to |
| But is your need for financial advice that clear and | | | | our achieving what we want. That does not mean |
| dramatic? Probably not. Let's consider the five top | | | | you won't be uncomfortable about being told to do |
| reasons you may need a financial planner and then | | | | something like save more money for retirement, but |
| look at what financial planning can do for you. | | | | it does mean a compelling argument will be made |
| A financial planner can help if you are in one of these | | | | based on your statements and your timelines for |
| five situations. They happen to all start with the | | | | retirement. |
| letter "U". Your situation is: 1) Unusual 2) Unexpected | | | | Financial planning is a road map. You are here and you |
| 3) Ugly 4) Unruly 5) Uncharted | | | | want to get to there. Yes, we are talking about your |
| Let's start with Unusual. | | | | money not a car trip, but there are similarities. If you |
| 1) Something unusual has happened in your life. You | | | | want to drive from Boston, Massachusetts to San |
| won a big lottery. You are getting a divorce. Your | | | | Diego, California, there are many roads that you |
| spouse died. You inherited money. In each case-good | | | | could take. You decide how fast, how scenic, how |
| or bad, a significant change in your lifestyle may | | | | expensive a trip you want. |
| occur. These have in common that you are not in | | | | With a financial plan, you are stating your goals and |
| control. They happen to you. | | | | asking someone with training to show you some |
| 2) The Unexpected has happened: you are about to | | | | choices that can get you to those goals. A good |
| lose your job or you just lost your job. Here you | | | | advisor, financial planner, money coach, will get you |
| have some control because you can look for another | | | | on the right road given 1)who you are, 2)what your |
| job and you have kept your skills or resume up to | | | | money habits are, 3)how much money you have to |
| date. Maybe you contributed to the reason you were | | | | invest, and 4) how much stick-to-it-ness you have. |
| let go. Your home was destroyed by fire, but you | | | | Let's take on those five points. |
| had insurance. So you were prepared as prepared as | | | | 1) Who are you? Are you someone who wants to |
| you could be for something this awful. | | | | learn about investing, or someone who just wants a |
| 3) Something Ugly has happened that throws you | | | | strategy to follow? Are you too busy with your life |
| into court or a hospital: a law suit against you; identity | | | | to care about money? Do you have a love-hate |
| theft; a terrible accident; a debilitating illness. The | | | | relationship with money? What is your history with |
| courts and hospitals although they can bring about | | | | money? |
| good outcomes are often stressful and financially | | | | 2) What are you money habits? Money habits are |
| draining. | | | | not about how big your paycheck is; they are about |
| 4) Your finances are Unruly on a day to day basis. | | | | how you define: needs, wants and luxuries. Has the |
| You feel out of control not knowing where the | | | | paycheck covered the needs or is there a worry |
| money is going. You think that you are making an | | | | about paying your bills? Is your habit of mind about |
| adequate living but for some reason there's "no | | | | money that it is to be used today without much |
| money." What are you doing wrong? | | | | concern for tomorrow? Are you so used to saving, |
| 5) You, or you and the person you manage money | | | | that it is hard for you to have fun? |
| with, are yelling about money, or do not have a joint | | | | 3) How much money you have to invest and when |
| vision of where you are going with your money, or | | | | you need to arrive at your financial destination are |
| you are not maximizing your money for the goals | | | | key components for the financial plan. If you have |
| that you have. You find your future is just Uncharted. | | | | $25 a month to invest you can begin a program, but |
| There are: Conflicting goals, No stated goals, Goals | | | | there are not as many investment vehicles available |
| with no strategy for reaching them. | | | | to you. |
| So whether you are in a situation that is unusual, | | | | But you can make a meaningful beginning. If you |
| unexpected, ugly, unruly or uncharted, you are feeling | | | | have a goal that must be reached in one year, then |
| uneasy or even frightened, and you want to do the | | | | too you have fewer choices. So dollars and your time |
| best you can with your money. In addition to feeling | | | | frame narrow down the many investment options. |
| uneasy, you feel that you don't know enough for the | | | | 4) Can you stick-to-it? This financial plan is about the |
| next stage. You've reached your limit for figuring out | | | | process of investing which includes the paperwork of |
| how to improve your situation, and you do not have | | | | applications and forms, as well as the nature of how |
| enough knowledge of the marketplace of | | | | money grows in the marketplace. If your |
| investments. Now is a good time to call in a financial | | | | investments go down instead of up will you bail out |
| planner. | | | | or will you learn enough about long-term investing to |
| A good financial planner is first a good listener who | | | | stay with your financial plan? |
| wants to know what you want, what worries you | | | | So bring in the advice of a financial planner when you |
| and what fits your money lifestyle. The first meeting | | | | want to do better with your money, and you want a |
| with the planner should be about you. | | | | strategy to lead you to your goals. |
| At the next meeting, the planner should set out | | | | |