A certified financial planner (CFP) is a designation that is recognised in 27 territories around the world, and is the standard of excellence when it comes to financial planning 

Although there are now – in large part thanks to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry – far more stringent guidelines around financial planning and the financial services industry than ever before, there is a need as a consumer of any service to undertake some due diligence.

Just like every chef, doctor, mechanic, or accounting professional are not created equally, nor are financial planners. However, thanks to certification standards, industry governance bodies, government regulatory bodies (such as APRA and ASIC), the professionals in the financial industry are being held to a higher standard than ever before.

What is the standard in financial planning in Australia?

According to the Financial Planning Association of Australia (FPA) “For more than 30 years, the Certified Financial Planner® certification has been the standard of excellence for financial planners. CFP professionals have met extensive training and experience requirements and commit to the highest ethical standards that require them to put their clients’ interests first. 

The CFP® designation is fast becoming the first choice for clients and employers – and it’s easy to see why. The highest designation in financial planning, coupled with commitment to the highest ethical standards, sets CFP® professionals apart from the rest.”^[1]

What does the CFP standard provide for a client?

When you engage a financial planner with the CFP certification, you should expect an extremely high level of care, industry best practice skills and expert service.

This is in large part thanks to the high degree of CPD or ‘compulsory professional development’ that is expected of members, the minimum entry requirements and the industry professional standards that govern them as individuals – both professionally and personally.

Although this may sound somewhat dramatic, in the wake of the activities by many financial planners prior to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, many practices that wouldn’t stand up to the ‘pub test’ were routinely rolled out by many so-called professionals in the industry.

For a CFP to achieve the certification and accreditation, they must adhere to not only industry best practice, but be leaders within the industry.

As a client, you can be rest assured that when your financial planner is a CFP, they will be held more accountable, as the CFP accreditation holds them to that standard, but also brings them business and allows them to charge the applicable fees.

What happens if I am not happy with my CFP?

If you are not happy with the performance of your CFP, and you feel they have acted inappropriately or recommended products or services outside your risk tolerance, or potentially provided false or misleading information – then you have yet another avenue for restitution when they are a CFP.

However, it isn’t all about doom and gloom, quite the contrary, a CFP is an industry professional, one that has worked extremely hard to not only be recognised by their industry as a top practitioner, but has to ensure their skills – both technical and interpersonal – are developed each and every year to better service you as a client. So, next time you speak to your financial planner, ask if they are a CFP, if not, why not?

[1] https://fpa.com.au/education/cfp-certification/

There is a vast array of expertise, training, qualification and ongoing development

that is required to become, and remain a financial planner  

There are many different business professionals offering almost as many services in today’s personal finance world. When it comes to financial planning, as could (and should) be expected there is a vast array of expertise, training, qualification and ongoing development that is required for qualified financial planners not only in Australia, but across the world.

A financial planner has several core duties:

• Analysing and understanding a client’s current situation, and actioning, scrutinising and monitoring investments on their behalf
• Making recommendations with regards to investments, superannuation and retirement planning
• Helping clients to manage and invest their money to help them meet their financial objectives.^[1]

Although there were many pathways prior to the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, there are not far more stringent guidelines to becoming and maintaining your status as a certified financial planner in Australia.

In 2019, new education and training standards were imposed upon all existing and future financial planners and advisors to ensure you as the client receives the very best in advice and service.

According to the ASIC website, in relation to the qualification, exam and professional development of financial planners, existing financial advisers must bring their qualifications up to an approved degree or equivalent level to meet the education requirements.

They must have an approved bachelor’s degree (AQF7 level) or above or equivalent. The maximum requirement is an approved graduate diploma (AQF8 level) comprising eight subjects.

Depending on their current qualifications, an existing financial adviser may only do bridging courses, such as the FASEA Code of Ethics (if it was not included in their qualification).

For new financial advisers, the minimum education requirement is an approved bachelor’s degree (AQF7 level) comprising of 24 subjects, or above or equivalent.

Where a new financial adviser already holds an appropriate qualification, they can meet the education standard by attaining an approved graduate diploma (AQF8 level) comprising eight subjects.^[2]

How is this enforced in financial service firms?

Within a financial services firm, there must be an AFS licence, or Australian Financial Services licence held by one or more senior parties to the business. A business providing financial services must hold an AFS licence.

Your financial planner will need to have a current AFS licence or be a representative of a licensee from the day they start your financial services consultation.

However, ASIC notes that consumers should be aware that the licensing process is a point-in-time assessment of the licensee, not of its owners or employees. Holding an AFS licence does not guarantee the quality of the licensee’s services.^[3] 

Why is the education level of a financial planner important?

Seeing that holding the licence “does not guarantee the probity or quality of the licensee’s services,”^[4], it is vital that consumers know that your financial planner is not just picking ideas from the newspapers and presenting them to you.

Having completed a bachelor’s degree and subsequent post graduate diplomas, your financial planner needs to continue their studies with CPD or compulsory professional development. Within this training they develop their technical and ‘soft skills’ within their profession.

This continuous development ensures that clients have a financial planner that understands the current laws, that is only providing the most up-to-date advice, and that any advice you receive is from someone who has spent the best part of a decade in achieving their qualification to be sitting in front of you.

Although financial planners may differ in their approach, they access to information, their use of tools and technology, you can rest assured that they are qualified to do so when they are a member of the FPA (Financial Planners Association), are a registered CFP (Certified Financial Planner) and are the holder of a FSL ( financial services licensee).

One final recommendation before you commence with any financial planner, is to ask to see their up to date credentials to this effect, thus proving to you through your due diligence that they are certified to plan your financial future.

[1] https://www.seek.com.au/career-advice/role/financial-planner

[2] https://asic.gov.au/for-finance-professionals/afs-licensees/professional-standards-for-financial-advisers/qualification-exam-and-professional-development/

[3] https://asic.gov.au/for-finance-professionals/afs-licensees/

[4] https://asic.gov.au/for-finance-professionals/afs-licensees/

Ask the right questions, hold your financial planners accountable, and ensure you maximise the upside of working with them, and more importantly, them working for you 

When working with a financial planner, there are several key ways individuals can maximise results and take responsibility for your financial future.

Firstly, we need to ensure that you have done your due diligence, investigated your planner and understood your goals and aspirations in terms of finances.

Then comes the important part, honesty. Yep, just like when the doctor asks how many standard drinks you have per week and you say, “oh only a couple of a Saturday night”.

To maximise the upside of working with your financial planner, you need to ensure you are honest, transparent and provide them access to anything they may need.

From access to bank statements, credit card statements, and home loan documents, these professionals are experts in confidentiality, but they are also experts in working out the best personal plans for their clients’ finances when they have all the information.

How to maximise your financial planner and the financial planning process

Now that we have that section out of the way, we have taken the next section straight from the FPA website, on how to maximise getting the most out of your financial planner and the financial planning process.

1. DEFINING THE SCOPE OF ENGAGEMENT

Your financial planner should explain the process they will follow, find out your needs and make sure they can meet them. You can ask them about their background, how they work and how they charge.

2. IDENTIFYING YOUR GOALS

You work with your financial planner to identify your short- and long-term financial goals – this stage serves as a foundation for developing your plan.

3. ASSESSING YOUR FINANCIAL SITUATION

Your financial planner will take a good look at your position – your assets, liabilities, insurance coverage and investment or tax strategies.

4. PREPARING YOUR FINANCIAL PLAN

Your financial planner recommends suitable strategies, products, and services, and answers any questions you have.

5. IMPLEMENTING THE RECOMMENDATIONS

Once you’re ready to go ahead, your financial plan will be put into action. Where appropriate, your financial planner may work with specialist professionals, such as an accountant or solicitor.

6. REVIEWING THE PLAN

Your circumstances, lifestyle and financial goals are likely to change over time, so it’s important that your financial plan is regularly reviewed, to make sure you keep on track.^[1]

As you can see, it is all about being prepared, being clear on your goals, not simply your wants or desires. It is about being realistic, having a plan, engaging the services of a trusted financial planner and conducting regular reviews of that plan.

When it comes financial planning, if you go off-course, that is fine, your financial planner is there to work with you and take things to the next level.

[1] https://fpa.com.au/about-financial-planning/how-it-works/

There are a key set of variables that you want to ensure you have a handle on with your financial planner, to keep them honest and accountable 

Like with anything, we all enjoy value for our hard-earned money! Be it from a great deal on a new outfit, a discount on your next family holiday, or even 50% off on your favourite items at the local supermarket – it is the feeling of a win.

Not only is it that ‘winning feeling’ but more theoretically, it is the knowledge that your investment in resources (money & time) have been put in the right place to maximise your desired result.

Before we move too far forward, we need to outline some key definitions. Firstly, the use of money can be defined more accurately by the ‘time’ at which you wish to use it.

For example, say you inherit some money from your parents’ estate when they sadly pass, then you and your advisor invest in shares/ stock of an oil producer. By doing this, you are moving your wealth from the present to the future.^[1]

Therefore you ‘invest’ now, to move your wealth from the present to the future. Meanwhile, you may wish to use that money to ‘consume’ now – rendering those same funds null and void should you wish to use them in the future. This is an important distinction for the next section of this chapter.

When choosing to use the services of a financial planner, you are choosing to plan, hence, moving your wealth from the present to the future. However, there are going to be costs that you need to consume for the ‘services’ both now (for the planner’s time) and into the future (trailing commissions, performance commissions etc) depending on the type of services and investments you choose.

So, what are the key metrics by which you should measure your financial planner?

As a client of a financial planner, it is often hard to look past the ‘bottom line’ or in other words how much money you made this year vs. last year.

In addition, it is often difficult to ignore the often-dramatised success of people investing in speculative or high-risk instruments – which in many cases is no different to putting your money into the casino!

Here is what to look out for when you want to measure up your financial planner:

1. Past Performance

You may have heard the term “past performance is not an indication of any future returns” and this most certainly is the case. However, if you are looking for a capable financial planner, you most certainly want to deal with one that has a history of delivering returns – ideally superior returns to just putting your investment in a bank term deposit or managed fund.

Ask for a review of the past 5, 10 or even 20 years performance if your financial planner has been around for that long, and take a look at what they have delivered for their clients.

If you are already engaged with your financial planner, it is key that you again look at the past performance, how your money has tracked in the short, medium and long term vs the plan you sat down and created together at the start of the financial year or your engagement with the planner.

If there are deviations, they need to be worked through, strategies iterated and plans updated to ensure that your financial goals and objectives are being met, or better yet, exceeded.

2. Planning

We all understand that things don’t always go to plan, nor is it always wise to stick 100% to the program. As a client, your financial planner should have a handle on your accounts, on opportunities that could be appropriate, but also if things are not going as planned - they should have a way to get things back on track.

Implementing hedging, divesting some investments and moving them into different asset classes when required is one of the key features you should be looking for in a financial planner.

You should always measure your financial planner on what is coming next, not just what has happened in the past. What are their plans for your money? What are their plans to increase your wealth and enable you to enjoy your future with financial security? If they can’t answer that, even if your performance is outstanding, then you have some serious questions to ask.

3. Transparency

One of the key elements to consider around performance and measuring is not just what your financial planner is saying, but what they are not saying. You need to take a look into your statements, into their marketing materials, their product disclosure statements and ask several key questions:

1. Are the returns in my portfolio clearly displayed and easy to understand?
2. Are my returns compared to applicable benchmarks?
3. Is my broker or advisor willing to walk me through any aspect of the performance that I don't understand?
4. Are my returns beating their benchmarks?^[2]

If you are answering no to any of these key questions, then it is time to have ‘the hard talk’ with your financial planner to ensure you are getting the right advice, not off the shelf service.

4. Accountability

In addition to this, your financial planner should exercise accountability in relation to investment vehicles, funds or instruments they direct or advise you to invest in. For example, if your financial planner has a retail fund – such as a property investment opportunity with 15% returns p.a over 5 years, that may sound great, and it may fit into your risk tolerance, however, has your financial planner invested their own money in the funds?

There is no better way to keep them honest and accountable to what they are recommending you to invest in, than by ensuring they are investing in that same product themselves.

In summary…

Although it may seem obvious, the first KPI (key performance indicator) that you should be looking at as a measure of your financial planner's performance is the financials. How much has been made/lost? Has the plan that was formulated at the start of your planning process been stuck to? If not, why and were you informed?

In terms of your performance were you over what you expected, if so is your portfolio investing in assets that are above your risk tolerance? Conversely, if you are not achieving the benchmarks, is your portfolio investing in the right products? Is your planner too conservative? These are all questions you should be asking.

Then you need to ensure that they are being transparent in their reporting to you, honest about the performance of potentially underperforming assets or potential bad investment choices. By doing this, they are being accountable, which is paramount to ensure your financial future.

Remember, that this is your money, your future, and your path, although your financial planner is acting as a ‘tour guide’ of sorts, you should not feel out of your depth with any of your investments. You should feel that you are getting value for money, good service and honest people acting on your behalf.

[1] McMillan et. El (2011) Investments: Principles of Portfolio and Equity Analysis, CFA Institute, Wiley & Sons, NJ, USA, P.3

[2] https://www.fool.com/investing/general/2012/05/11/how-to-assess-your-financial-advisors-performance.aspx

If you have ever heard the adage “You have to spend money to make money”? When it comes to your Financial Planner, nothing more is closer to the truth.

“For many Australians, one of the big barriers to getting financial advice is the cost. In 2019, ASIC research found that 41% of Australians intended to get financial advice in the future. Despite this, 35% of respondents said one reason they did not or might not get advice was because they thought it was too expensive.”^[1]

Although, this may be the case, like with people planning their superannuation and where they go (yes, that is also a function that you Financial Planner can do for you both through selection of super funds or SMSF, but more on that later), if you select the wrong plan or investment type, then over time this could cost you tens of thousands, even more!

While financial planning may be considered outside the budget of many Australians, giving up a couple of dinners out each quarter to cover the cost may be one of the most impactful and positive changes to your lifestyle you could ever imagine.

There are many elements to financial planning, and we will outline the initial and potential ongoing costs, then also the types of billing often undertaken by the industry.

It should also be noted that post the Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, there have been dramatic changes to ongoing, grandfathered and rolling commissions that were being paid for planners and advisors, ensuring that the industry provides a more level playing field and recommend the ‘right’ products to clients, not just those that have the largest ongoing payday.

So, how much should Financial Planning cost?

As outlined in previous chapters, with financial planning you need to look at your future, like a business would, and set up a business plan or a financial plan.

This detailed roadmap will typically cost between $2000 and $3000 from most planners, as there is a comprehensive review of your current situation, goal setting, gap analysis then a full review of the services and products that could assist in closing the gap between where you are and where you want to get to.

According to research by Investment Trends, on average you’ll be charged $2,250 in up-front fees the first time you see a planner. Younger clients (under 45) tend to pay half of what older clients pay on average ($1,200 vs. $2,600). This is because younger clients tend to have less wealth accumulated and require less complex advice.

Then when you continue your relationship with a planner, the average ongoing advice fees are approximately $3,450 per annum.^[2] This continuation is almost as important as the plan, if not more-so.

The reason you need ongoing, meaningful support is to ensure that your plan stays on track, or iterates to support your new goals, objectives or circumstances. For example, you may come into some inheritance that you didn’t expect, you may lose a high paying job or you secure an opportunity to retire earlier.

Sure, financial planners can help you make money, save money, invest money and even get that boat or holiday home, pay your mortgage off sooner, all of which is incredible. More importantly, the small cost in the overall scheme of your income and expenses is that you are getting set up for your future.

[1] https://www.canstar.com.au/superannuation/financial-advisor-fees-cost/

[2] https://fpa.com.au/news/much-cost-see-financial-planner/

Once you have decided that you want a financial planner, finding a good one is the next step.

Like your personal financial situation, finding the right financial planner is a very subjective process – you need to find the best financial planner for you.

While you need to ensure your financial planner has a personality that you can ‘work with’, you need to remember you are looking for a fully qualified, licensed, expert professional that has your future interests and financial longevity at the forefront. You are not looking for a new best friend, nor someone to get horse tips for the next race at Flemington.

As such, you need to look through the veneer, peel back the blinds and ensure you use due diligence in the selection process of your financial planner – not just pick the first one that comes along.

Personal recommendations

Personal recommendations are always a great place to start, you may have a family member or friend who knows or uses a financial planner. However, this does not mean the recommendation is the ‘best fit’ for you.

A financial planner needs to be your financial coach, build your financial roadmap, and ensure they have your best interest at heart.

A personal recommendation may go a long way to achieving this goal, and it certainly navigates a lot of the time and effort that a full-scale search may entail. However, we always recommend getting at least one second opinion, meeting at least one other financial planner, if nothing else, so you can see who realises the best potential of your personal and financial goals.

Forums and Google Searches

A little bit of information is a dangerous thing, and nowhere more so than on the web. From uninformed forums, blogs and articles written by content writers with no experience in finance, no qualifications, and some with an axe to grind, many often looking to create ‘click bait’, or generate leads.

Although initial information searches are a great place to start, nothing counts more than meeting face-to-face, asking some tough questions of your ‘soon to be’ planner and ensuring things are online. Just as you should not diagnose your illness using ‘Dr. Google’, don’t put your financial future in the hands of a bunch of often misinformed - and ‘often angry’ - keyboard warriors’.

Professional recommendations

You may already have professional services that you know, use and trust. These could include accountants, lawyers, marketing, advisors etc. These professional services would often work with people within the financial sector, including financial planners.

It should always be noted that you, as the client and as the person whose financial future is at stake, should always conduct due diligence, ensuring that you are happy with your potential financial planner, not moving forward with engagement to appease your referrer.

Professional registers

In the wake of the 2019 Royal Commission into Misconduct in the Banking, Superannuation and Financial Services Industry, it was clear that governance of the industry, rouge financial services operators and exorbitant fees – in some instances for no service, and in other examples for the recommendation of products & services that were overpriced, sometimes leading to losses, or total losses of investors’ funds – were rife.

Although it was a vital step to ‘clean up’ the financial industry, the industry was tarnished with a broad brush, and even the very best operators within the industry were subjected to unfair assumptions & vilifications.

With the Financial Planners Association of Australia (FPA) as the industry body that works with financial planners to ensure they are compliant, regulated, upskilled and promoting industry best practice, in conjunction with the Australian Governments’ Smart Money website, there are lists or registers of financial planners that are available for review and contact.

The Smart Money Financial Advisors Register and the FPA’s Find a Financial Planner webpage provide some solace that you are protected by standards and governance levels that are required to be passed and upheld by the operators within the industry.

Although you are taking on financial advice and making the ultimate decisions yourself, if you choose an FPA planner, you at least know there is recourse and an industry body that governs the transactions and activities of their members.

However, ultimately, the advice that you take on financial matters is just that, and things can change. As mentioned, it is just important that you find a trusted planner that is ideally local to your home or office, that you have been referred to or has provided testimonials from current clients and finally is a member of the FPA or on the Smart Money register.

Transparency is the key in all your financial matters, just ask yourself…is this person looking after my best interests and can I see myself meeting with them in 10, 20 or even 30 years? If so, then you are on the right track.

A financial planner can provide you with meaningful advice, realistic advice about what your financial future could look like, and importantly how to get there.

When thinking about your future, there are many things that no matter who you are, we all consider at one point in time.

How much money do I need to live the life I want? What age will I retire? Why is it that people around me are able to afford new cars, new homes and investment properties and I can’t?

Regardless of if you are 30-years old, or 60-years old a financial planner can provide meaningful and realistic advice about what your financial future could look like, and importantly how to get there.

Obviously before you move to getting financial advice, it is vital that you ask yourself (and your partner if applicable) some key questions. What am I looking to achieve? How much do I have now? How much can I realistically earn over the foreseeable future? How much of that can I invest? And importantly, what am I trying to achieve?

There is no point booking an appointment with a financial planner should you be walking in with unrealistic expectations. Such as I earn $45,000 and I want to buy a Ferrari and a holiday home on the Gold Coast in 5-years’ time. Unless you win the lottery or have some inheritance coming your way, we are sorry to say this is not going to happen.

You need to look at yourself objectively, be honest and work out the reason why you, in your current financial situation, want to see a financial planner.

Why do people use financial planners?

There are two key reasons people seek financial advice, these are general financial advice and personal financial advice.

General Financial Advice, as the name suggests, is advice that doesn’t take into account you and your individual situation. This may be advice about a particular investment vehicle, such as shares, cryptocurrency, an investment fund etc. The advice doesn’t take into consideration how you may be liable or affected by the product or service personally.

Personal Financial Advice is a more comprehensive, tailored review and advice for you, of you now, where you wish to be in the future and the mechanisms available to you, in your current financial situation to get there. A qualified and certified financial planner will ask a series of detailed questions about you, together you set goals, review products and services applicable to your personal situation, and then advise you and manage your progress moving forward. Services may include, but are not limited to:

• Simple, single-issue advice— Help with one financial issue, for example, how much to contribute to your super, or what to do if you inherit shares.
• Comprehensive financial advice— Help to develop a financial plan to reach your financial goals. This covers things like savings, investments, insurance, and super and retirement planning.
• Ongoing advice— Regular monitoring and review of your financial plan and affairs.^[1]

With the rise of the ‘gig economy’, changes in working conditions, Self-Managed Superannuation Funds (SMSF) and general market access to riskier investment options (such as cryptocurrency, CFDs and other leveraged, often speculative instruments) a financial planner is often not only a good idea, but a mandatory one.

Why is a financial advisor so important?

Gone are the days where you start a job from the bottom of the company, work your way up for the next 20, 30 or 40+ years, collect your gold watch and retire to watch the sunset at your beach house as your grandchildren listen to you talk about ‘the good old days’.

The seismic generational changes in technology, historic housing price spikes, employment, how we work and who we work for – not to mention access to debt and credit facilities or the global economy, have all led to people wanting a work life balance. Working for themselves, working from home, working from anywhere – all sounds fantastic, until you realise that you are 50+ with no superannuation, a mortgage that you can’t foreseeably pay off and no ‘extra’ or ‘passive income’ from investments outside your work.

A financial planner can work with you, from a VERY small base, to set up your future. Including but not limited to savings, investments in funds, shares, alternative investments, currencies and much more, to provide income streams and security for you – despite your annual income.

When is the best time to see a financial planner?

Many people feel that financial planners are either “only for rich people '' or alternatively is like going to the dentist, and often ‘kick the can down the road’ as they may be embarrassed at their level of personal debt, number of credit cards or lack of financial prowess. WRONG!

The best time to see a financial planner is right now. Why, because today is literally the first day of your new financial life from the day you meet with a financial planner – no matter your financial situation.

Financial planners are there to work with you, and really only benefit when you as their clients do, not only now, but into the future. For example, if you are in your mid 30’s, with a few credit cards, merger savings and can’t see how you could ever get a mortgage like your friends – a financial planner can get you there.

If you are in your 50’s and are realising you have 15-20 more working years and want to set yourself up for retirement – a financial planner can help.

You are the recent recipient of some inheritance and you down want to see it go to waste – a financial planner can help.

Financial planners are experts in just that, planning how to realise the best outcomes financially for their clients over the short, medium, and long term.

And sure, there may be some home truths, some budget cuts, your ego may even take a bruise, but when the dust settles you will have a plan, with defined goals, and you will literally see the results starting to happen from week 1.

From there, your financial future will be more secure, it’s important to note, you need to take the first steps – but you also need to be responsible and take responsibility of your money, as the financial planner can show you how and work by your side, but only you can make your financial freedom a reality.

[1] https://moneysmart.gov.au/financial-advice/choosing-a-financial-adviser

Financial planning is the process of setting yourself and your loved ones up for a future in which you can enjoy, live comfortably and not worry about financial matters.

Many people have an idea what financial planning is, setting a budget, saving, investing money and helping people with money realise growth on that money. However, these people would be incorrect.

Financial planning is the process of setting yourself and your loved ones up for a future in which you can enjoy, live comfortably and not worry about financial matters. This is not saying that you will be throwing stacks of $100 notes around on your yacht like a rockstar.

What most people don’t understand about financial planning is it is a service for everyone from all socioeconomic and financial backgrounds. Everyone’s future is different and everyone expects different things – so when we say financial stability, that could be getting an additional residual income of $50,000 per month or $500 per week – it can be done with a cohesive financial plan, undertaken with a professional financial planner.

So, what is financial planning?

No matter what your goals are in life, it’s essential to plan ahead. A qualified financial planner can provide support to set goals and develop a practical plan to help you achieve them. As you move through life and your circumstances and needs change, a financial planner can review and tailor your plan, to ensure it’s still right for you.

Financial planning offers a solution on how to more effectively manage your finance in the short, medium and long term. This can be anything from saving from a holiday to building a comprehensive and diversified portfolio of financial assets.

Where a personal trainer works with you to help reduce weight or achieve a goal of running a marathon, a financial planner does precisely the same thing – but for your finances. With a top-line view of your situation, a financial planner will work with everything within your disposal. Household budgets, savings, superannuation, discretionary spending (such as holidays), investment options and of course planning for your retirement.

I have debt and little savings, so should I see a financial planner?

Of course! Take our example of the personal trainer once again. It doesn’t matter if you are 50kg or 150kg, seeing a personal trainer is essential for many reasons. They personalise a program for you, have you doing regular exercise within your personal circumstances and up the weights, distance and/or time as you progress – again, a financial planner is no different.

You may have several credit cards, a HECS Debt from university and be living from pay-to-pay to make ends meet, or you may be financially savvy with savings, investment properties and a portfolio of shares – it does not matter, a financial planner can help!

What is the process of financial planning?

As your financial wellbeing – as with your health & wellbeing – will largely dictate how your life is lived both now and into your future, it is important that you establish a meaningful and long-term relationship with your financial planner.

A good planner will work about setting goals, creating a plan and providing you with expert guidance, tips, techniques and opportunities to get your finances to where you want them to be. That is not to say they will make you a millionaire overnight, but they can set you up within your capacity, based on what you earn, what you can save and what you need to run your household - and of course take that holiday – while setting yourself up for the future.

You may have noticed that we keep talking about ‘a holiday’. Why? Because there is a misconception that by seeing a financial planner, they will tie all your money up and only let you have it down the road when the investments mature. Again, this is not true.

As mentioned, a Financial Planner sets your financial goals, ensuring they are S.M.A.R.T or Specific, Measurable, Actionable, Relevant and Timely.

For example, you may want enough money from 2022 to have one, overseas family holiday per year – fine. You may wish to retire by 60, with over $2 million in assets and investments outside the family home – ok. And I want to be a millionaire next week – not so good.

S.M.A.R.T objectives allow you to be real about what you can achieve within your personal situation, your risk tolerance, the years you realistically have left to work, and your earning capacity. You may now have school fees to contend with, when they are removed from the equation you can redistribute that money into your investment portfolio to maybe buy an investment property, shares or invest in a managed fund.

The key is and mentioned several times, it’s all done to a plan, with your Financial Planner, who meets with you each quarter, month, year – whatever suits you – and works collaboratively to achieve your goals.

Summary

In summary, there is never a bad time to set an appointment with a financial planner. Whether you are drowning in debt, through to driving your Porsche during the week and your Bentley on the weekend – a financial planner can help you move from where you are today, more effectively and efficiently to where you want to be tomorrow.

A failure to plan is a plan to fail, however when we are talking about you and your family’s financial security, your retirement, quality of life and yes holiday’s is this something you really want to gamble on?

Financial planning is planning to ensure the rest of your life is comfortable and you can spend it doing what you love, with whom you love and on your terms.