Explain the Financial Planning Process

Explain the Financial Planning Process

I want to use this article to explain the financial planning process. Many competent, well-educated adults readily admit they struggle with even basic financial concepts.

This really is not surprising because most school curriculums do not teach financial management fundamentals. However, this is where an expert financial planner enters the picture. Financial planners work with individuals and let them organize and handle the fiscal facets of life.

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Explain the Financial Planning Process

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Unfortunately, many people are hesitant to utilize a financial planner since they're not familiar with the way the financial planning process functions.

The financial planning process explained

The process of financial planning can generally be broken down into basic steps:

Step 1 – Preliminary Meeting & Assessment

During an initial interview, the financial planner and the potential customer get to understand one another. This normally involves a primary meeting through the planner describes the character of solutions to be supplied and the manner by which he or she's compensated for all these services.

Subsequently, the potential customer has a chance to ascertain whether the planner has the power to offer you the sorts of services which are necessary. The planner must take this chance to find some general notion of their potential customer's present financial standing and long-term objectives.

Step 2 – Gather Information & Establish Goals

To work, the financial planner needs to collect a sizable quantity of information regarding the customer. The data gathered can be quantitative (e.g., fiscal information regarding the customer's earnings, expenses, and resources ) or qualitative (e.g., non-financial info regarding the customer's risk tolerance, expectations regarding future standards of living, and health of the client and household members).