Financial planners will inevitably meet with their client’s other advisors-attorneys, accountants, trust officers, investment bankers-in order to fully understand their client’s financial goals. The last thing a financial planner wants to do is map out a plan that conflicts with investments that their client has already made with their bankers. Financial planners may come from many different educational and professional backgrounds. If you’re considering using a financial planner, be sure to ask about their background. Financial planners advise clients on how best to save, invest, and grow their money. They can help you tackle a specific financial goal such as readying yourself to buy a house? Or give you a macro view of your money and the interplay of your various assets.
Planning often requires consideration of self-constraints in postponing some enjoyment today for the sake of the future. To be effective, the plan should consider the individual’s current lifestyle so that the ‘pain’ in postponing current pleasures is bearable over the term of the plan. Planner’s that do that many are categorized as Fee-Only advisors. Until then you’re not going to find an advisor that is as motivated as you are about your money from a client’s perspective. Planners can also make recommendations and give advice on how to implement your plan. It is important to be mindful of potential conflicts of interest when recommendations could also stand to benefit the planner.
Planners get paid in one of four ways: hourly, flat fee, commission from products sold to you, or by % of your assets managed. You do not want to get into a situation where you are paying a percentage of your managed assets to a financial adviser. Planners can be payed in a variety of ways and it’s important to find a particular compensation that best suites your needs.