Our Process
The financial planning process.
Coming up with a solid financial plan means doing some homework—both on your part and the part of your CFP® professional. From examining your current situation, to setting goals, to deciding how to measure your progress, a CFP® professional is uniquely qualified to take you through the financial planning process.
In six steps, you and your CFP® professional will:
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Agree on how to work together
- Your CFP® professional will explain the services he’ll provide and define each of your responsibilities. Along with compensation, you’ll discuss how long the professional relationship will last and how decisions will be made.
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Gather information about your finances and set goals
- You and your CFP® professional will talk about your current financial situation and gather any necessary documents. Together, you’ll define your personal and financial goals, including timeframes. You may also want to discuss your comfort level when it comes to taking financial risks.
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Analyze and strategize
- Your CFP® professional will take all your finances into account and determine how to meet your goals. Her analysis may cover your assets, liabilities and cash flow, current insurance coverage, investments, or tax strategies.
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Develop recommendation
- Next, your CFP® professional will go over his financial recommendations, explaining the rationale so you can make informed decisions. He will address your questions and concerns and revise his recommendations if necessary.
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Put plan into motion
- You and your CFP® professional will need to agree on how the recommendations will be carried out. Your CFP® professional may carry out the recommendations herself or serve as your coach, coordinating the process with you and other professionals, like attorneys or stockbrokers.
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Monitor progress and stay on track
- As you work towards your goals, you and your CFP® professional will need to decide who will monitor your progress to make sure you’re staying on track. If the planner is in charge, he’ll check in from time to time, reviewing your situation and making any necessary adjustments to his recommendations.
Above all else, you should have confidence that whichever financial planner you choose is competent and ethical. Financial planners earn CFP® certification by meeting education, examination, experience, and ethics requirements. In addition to delivering general financial planning services, many financial planners are also registered as investment advisors or hold insurance or securities licenses that allow them to buy or sell products.
Consumer Guide To Financial Planning