The following are the six steps in the financial planning process which Terence Tobin of My Money will use and go through with you:
- Establishing and defining a professional relationship
I will clearly explain and/or document the services to be provided to you and define both my and your responsibilities. I will explain fully how I will be paid and by whom. You and I should agree on how long the professional relationship should last and on how decisions will be made.
- Gathering data, including goals
I need to ask for information about your financial situation. You and I should mutually define your personal and financial goals, understand your time frame for results and discuss, if relevant, how you feel about risk. I will gather all the necessary documents before giving you the advice you need.
- Analysing and evaluating your financial status
I will analyse your information to assess your current situation and determine what you must do to meet your goals. Depending on what services you have asked for, this could include analysing your assets, liabilities and cash flow, current insurance coverage, investments or tax strategies
- Developing and presenting financial planning recommendations and/or alternatives
I can now offer financial planning recommendations that address your goals, based on the information you provide. At this point I will go over the recommendations with you to help you understand them so that you can make informed decisions. At this critical point it is imperative that I pay close attention and listen to your concerns and revise the recommendations as appropriate.
- Implementing the financial planning recommendations
You and I should agree on how the recommendations will be carried out. In some cases I may carry out the recommendations or serve as your “coach,” co-ordinating the whole process with you and other professionals such as attorneys or stockbrokers.
- Monitoring the financial planning recommendations
You and I should agree on who will monitor your progress towards your goals. If I am in charge of the process, I will report to you periodically to review your situation and adjust the recommendations, if needed, as your life changes.