Working with a professional financial planner can give you confidence and peace of mind that your financial future is secure.
There are many myths and misunderstandings about financial planning, that they are only for the wealthy, that they only push their products or the ones that make them the most commission, and even that they are expensive and a waste of time.
Firstly, all the above is not only false, but it is almost entirely the opposite.
Financial planning is about developing strategies to help you manage your financial affairs and meet your life goals – and the first step is to make sure you have access to the right advice.
An excellent financial planner sits down with you (and your partner if applicable) and sorts through your current financial situation, your future desires, and your capacity to bridge the gap from where you are now to where you want to be.
You should know that a financial planner can be beneficial to you regardless of your income level. But they’re most beneficial to someone seeking specific advice about their spending, saving, earning, or investing strategies (or lack thereof). A financial planner isn’t meant to teach you the fundamentals of personal finance but to show you how to use your money as a tool to accomplish what you want.
Your financial planner will form objectives to suit your short-, medium- and long-term strategies to achieve those objectives and recommend a range of financial services and products to achieve those objectives – hopefully, sooner rather than later.
To become a Financial Planner in Australia, one needs to meet the minimum standards set by the Australian Securities and Investments Commission (ASIC). From 1 January 2019 the Corporations Amendment (Professional Standards of Financial Advisers) Act 2017 requires new financial advisers to complete a bachelor or higher degree (or equivalent qualification).[1]
This new ruling requires even the most senior existing financial planners to meet the same minimum qualification standards that until the 2017 amendments were not in place. This is a great piece of mind for you as a client of the ‘new breed’ of financial planners.
In addition to their qualification, your financial planner should be a member of the FPA or the Financial Planning Association of Australia, which mandates that planners must, along with serving you as a client, complete a large amount of CPD or Compulsory Professional Development.
That means that they are going to be upskilled, trained and proficient in the newest and most advanced products and services to help you achieve the financial success and freedom you are looking to realise.
Financial planning is the sum of many parts, but most of all, as the name suggests, it is a plan.
Remove the subjectivity, look at your future through an objective lens.
If you are not from a business background, this may be a little hard to comprehend, but bear with us. So think of yourself as a business (and you as the CEO), and your financial planner, your CFO (chief financial officer) who has to map out the most prudent, logical and realistic roadmap for your business (you) to achieve the objective set by the CEO.
Every business has a business plan, a set of S.M.A.R.T Objectives (Specific, Measurable, Achievable, Relevant, Timely) that guide their strategies, their operations, marketing, sales, you name it.
[1] https://www.seek.com.au/career-advice/role/financial-planner