What is Financial Planning, you ask?
"Good fortune is what happens when opportunity meets with planning" - Thomas Edison
Financial planning is at the core of the services Ridgeview Financial Planning offers you. It's a cliche, but you wouldn't begin a long journey without a map, right? So it only makes sense that I work with you to develop an understanding of your goals and your current financial picture before making investment recommendations. This way your investment portfolio has a mission instead of being just a collection of investments.
The recommendations provided will be in writing and I'll go over everything with you. You'll receive clear, actionable advice, that could cover single topics like "Can I afford to retire?" or "When should I take Social Security?" or "How should I convert my IRA balances to a Roth?" Or we could work on a full financial plan spanning your entire financial situation, from retirement planning, investment planning, to insurance and estate planning.
Financial planning should address the following topics:
Additional Services as Required by the Client
Here are the essential steps we follow with every client:
- Establish & Define: Get Acquainted Meeting - This is complimentary and typically takes 20-30 minutes. We talk about your goals and your questions, our value proposition, and define how we'll work together.
- Data: Then I gather information about you (account statements, recent tax returns, retirement plans at work, social security statements, etc).
- Your Goals: Next we talk about your financial goals, both short-term and long-term, and about what's important to you.
- Analyze: I then analyze the data you've provided, ask follow up questions, and prepare recommendations.
- Recommendations & Implementation: Next I meet with you to present my recommendations, discuss implementation, and talk about who is accountable for what. All recommendations will be in writing.
- Monitor: Then we create a plan for monitoring your plan and investments. If we're working together on an ongoing percentage basis, then I'll handle everything. If we're working together on an hourly basis, then I'll come up with an appropriate review schedule.
What is financial planning to most of the financial services industry?
Well, unfortunately it depends on who you ask. For most "brokers" out there, including many with the CFP credential, financial planning is a process that leads to selling you a product. It's a means to an end. And too often the "plan" presented is what's known in the industry as a "Needs Analysis" to determine how much insurance you need or what kinds of "loaded" annuities and mutual funds, and expensive "managed accounts" the broker can sell you. Only one or two components are included and is often referred to as a "financial plan". These brokers leverage the fact that most investors don't know what real financial planning is. I believe this is a disservice to investors and it's something I don't practice with clients.