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6 Steps in Financial Planning

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An effective and consistent financial planning process where you and your Advisor work together to ensure a successful financial outcome.

Step 1  - Explain:

  • Topics and concepts related to financial planning.
  • Services the advisor will provide and the process of planning and documentation.
  • The responsibilities of your advisor.
  • The responsibilities as a client.
  • Discuss the scope of the client/advisor engagement. 

Step 2  -  Gather:

  • Information about your financial resources and obligations through interviews or questionnaires.
  • Defined personal and financial goals, needs and priorities.
  • Investigate values, preferences, financial outlook and desired results.

Step 3 -  Clarify:

  • Present financial status and identify challenges and opportunities
  • Analyze information to assess your current situation (cash flow, net worth, tax projections, etc.).
  • Identify problem areas or opportunities with respect to your:
    • Risk management needs and coverage
    • Investments
    • Taxation
    • Retirement planning
    • Employee benefits
    • Special needs (i.e. adult dependent needs, education needs). 

Step 4 – Developing and preparing a financial plan:

  • Tailored to meet your goals and objectives, values and risk tolerance, while providing projections and recommendations.
    • Your advisor will present the plan and establish an appropriate review cycle with periodic assessment.

Working together will ensure that the plan meets your goals and objectives.

Step 5 - Implementing

  • Applying the agreed to recommendations.  This may involve coordinating contacts with other professionals such as accountants, insurance representatives and lawyers. 

Step 6  - Monitoring 

  • Consistently evaluate your plan to ensure you are progressing towards reaching your financial goals. 
  • Your advisor will contact you periodically to review the plan, make adjustments , recommendations, if required, to help you progress toward your goals; this review should include: 
  • Evaluate the impact of changing tax laws, economic circumstances and fluctuating markets.  
  • Discussion about changes in your life circumstances, birth, illness, unemployment, marriage, retirement.
This article is for informational purposes only.