A look at the reliance on Financial Planners

What is a financial planner and what do they do?

This is a common question that is asked by many people, especially those who do not have much idea about finances, money and banking. Though money is not everything in life it could be considered as one of the most important aspects of our life. Hence, we should give the right kind of importance to money and should try and make attempts to grow money to the extent possible. This is not an easy job and unless we have a good experience and expertise in the field of finance, we will not be able succeed in our effort. It is a job that is best left to the people who have experience in this field and a good and competent planner in finance has the right kind of expertise in this.

Professional Financial Planners

A financial planner is person who gives the right kind of advice to us as far as managing our finances are concerned. Usually these professionals are available in banks, insurance companies or other such reputed financial institutions. There are also quite a few such professionals who have their own business and they give advice to people in their individual capacity. They are very helpful when you have a big chunk of money and are looking at ways and means to invest it. They are very capable of advising you about the various possible avenues of return. There are some options where the risk is low but the returns are also low. On the other side of the spectrum, there are some investments where the returns are high but the risk factor is also pretty high. Hence the financial planner is the right person to give you the right kind of idea to manage your funds properly giving you a good mix of returns without compromising too much on your funds.When selecting an efficient financial planners it good to check on the following: (taken from www.findfinancialplanners.com.au)

Look For Certified Financial planner

As money is a delicate subject, you have to meticulously choose the perfect planner. To identify an expert, take a look at his credits. Being a Certified Financial planner (CFP) is a very good sign that the chosen planner is capable of giving apposite financial advice.
Normally financial advisors may take commissions or charge hourly rates for their professional services. Whichever the case, make sure you plan your budget wisely to accommodate their fees too. It’s great to do a background check on your prospective planner and to check if his credentials are genuine. It’s good to ask around and find experienced professionals who have advised your friends in the past. In addition to this you can also target planners from planning networks such as Garrett Planning Network where financial planners commit to be available for small scale projects at an hourly charge.

Pay Attention

Stay away from financial advisors who take commissions as they may unnecessarily push you into an unprofitable insurance package or an unbeneficial mutual fund just because they are getting a big chunk of the proceeds. Beware of those who claim that their predictions are right all the time as the market is unpredictable and shifts up and down without prior warning, such claims are bogus.

Quality Financial Planner Services

The first service they should provide you with is objectivity. When each of us looks at our finances, we tend to place too much importance on the positives. In turn, we discount many of our problems. A financial planner should objectively review and lay out the frank facts on where you stand, potential problems and solutions. This step alone makes them worthwhile.

The second service is a symbiotic combination of two things. The planner should help you identify your financial goals and then they should provide you with strategies for meeting them. This sounds simple, but most people have no real idea of what their goals are. If you don’t know your goals, how can you possible meet them?

Identifying your financial goals is a critical step, but not the only one. Once the goals are clear, a quality financial planner is going to gently force you to prioritize them. Yes, everyone wants to buy a boat at some point. If you have kids, however, the planner might suggest that saving up for the $100,000 to $150,000 cost of sending them to college might be a better priority.

If you are married, a financial planner may be needed to bring an objective voice to the financial planning process. You and your spouse may have very different ideas about the goals you should have and how to prioritize them. A planner is often critical to getting both spouses to agree to a particular plan. Alternatively, the financial planner can come up with a unique approach that makes everyone happy. This is almost always a more successful approach than just letting the spouses battle it out.
At the end of the day, a good financial planner should be like a family friend. They should help you get organized on your finances in such a way that you can both identify and realize your ultimate goals.