Everybody is working toward something — a successful business, more time with their family or travel to exotic places. Surprisingly, very few people have a financial road map to help them fulfill these goals.
It’s not difficult to make a financial map; what’s difficult is getting started. To begin, take an inventory of your financial status, including assets, debts and budgets. This helps you anticipate opportunities and prepare for adverse events.
Repeat this process whenever you experience life event and lifestyle changes, such as marriage, divorce, starting a business, saving for your child’s educational expenses, preparing for retirement or receiving an inheritance. You may, for example, need to save more money to achieve your goals, find investments with higher returns or extend your plan’s time frame.
The road map will need updating for your journey, but with good planning that anticipates change, all roads will help lead to your personal goals.
Selecting a financial services provider
Individuals often do not know where to turn to begin the financial planning process. Many of today’s financial services providers are part of large, national corporations. The personal touch, so valued in the past, is sometimes difficult to find.
Financial products are becoming commodities as well. Whether you need personal or business-related financial planning assistance, establishing the right relationship with a financial services provider is crucial to achieving your personal goals through financial planning.
To begin your search, talk with your accountant or tax professional. Then ask friends and associates about their relationships with brokers, estate planners, insurance agents, accountants, lawyers and tax professionals. They can provide you with insight for selecting the right financial adviser to help you with needs such as retirement planning, asset management, investments, estate planning and conservation, insurance and tax planning.
Choose someone with integrity whom you trust, a person with whom you are comfortable developing a long-term relationship who will deliver expertise, sound advice and choice. Expect the same personal care and responsiveness that you would expect in any other important relationship.
Implementing your financial plan
Ideally, your new financial adviser will provide local, hands-on service but have access to resources to accommodate needs as you implement your financial plan. Whether your interest is in individual stocks and bonds, preferred stocks or mutual funds, or other financial products from the array of options available, your adviser should have alliances with private money managers and major mutual fund families, as well as access to a variety of securities products.
If you are a business owner, your business may be the centerpiece of your personal well-being and financial security. Turn to your financial adviser for such matters as business valuations and succession planning, benefit plans and insurance, financing and investment banking or acquisition and divestiture consulting.
Monitoring your progress
Review your progress with your adviser annually – it’s the best way to update your financial road map. Because it is inevitable, make sure your plan accommodates change. Some change is obvious.
For example, you’ll know almost immediately if the yield on your investments increases or decreases, which may require managing your assets differently.
Other changes are not so obvious. Your financial adviser will monitor, among other things, tax law changes and business climate changes to help you anticipate market fluctuations — up or down.
He or she will help you accommodate personal, family and business changes, including additions to your family, educational needs, changes in marital status, job or business changes that impact income, inheritance, disability or death.
A financial road map is a very useful tool for helping you obtain your personal goals. If you don’t have a financial plan, find a professional services provider and get started today. If you do have a plan, update it as often as necessary to accommodate life’s changes – planned or otherwise.
KAREN KLEINHENZ is partner and president of Skoda, Minotti Financial Services, a growing subsidiary of Skoda, Minotti & Co., an accounting and financial services firm that focuses on helping clients grow and develop their opportunities by becoming an integral part of their management team. Kleinhenz is expanding the firm’s financial services business to meet the growing and distinct needs of individuals and businesses. Reach her at (440) 449-6800 or [email protected].
