5 Key Ways A Financial Planner Adds Value

By September 23, 2019Financial Planning

As Financial Planners here at FAS, we understand the value of financial planning which we offer to our clients. However, that value isn’t always easy to explain to those unfamiliar with it.

After all, financial planning isn’t particularly tangible; you can’t “see” or “feel” it like you can with retail products, such as a new car. However, financial planning, when done properly, solves many key problems which many of us experience:

    How will I ensure my family is financially secure if I suddenly passed away?
    Am I paying more tax than I need to, and are there ways to free up more of my income?
    How can I be sure that I am fully complying with the various rules about my taxes?
    Can I ensure a meaningful inheritance for my loved ones at the end of my life?
    Is it possible to secure a comfortable, secure retirement income? If so, how?

These are all very important questions which can keep us awake at night. Moreover, the answers are not always clear to people. Take the world of pensions, for instance. There are numerous rules about the State Pension, Workplace Pensions and Personal Pensions which often change over time (e.g. due to Government policy).

Once you start peering into this world, it can sometimes feel intimidating, but speaking to someone who understands the landscape can really help. At FAS, we believe there are at least five ways a good Financial Planner can add real value:

Helping to Clarify your Goals

Have you ever set out to achieve a goal, only to later realise it was unrealistic? Perhaps you thought you could teach yourself Mandarin Chinese fluently within a year, for instance, and quickly realised that it would realistically take more time and investment to get there?

Without the help of a professional Financial Planner, it is easy to make a similar mistake with your finances and wealth. However, the danger is that the costs can be much higher. This is because it is often many years later when people realise that their original retirement goals were unrealistic. With a Financial Planner, however, you can plot your intended course much more clearly and with far better information at your disposal.

At FAS, we will be completely honest with you and explain why we feel you are aiming too high or low with your retirement goals whilst outlining the reasons why. Then we will propose strategies that are achievable, allowing for different possible future scenarios.

Pointing out Blind Spots

It can be easy to think that you have “covered all of your bases” in your financial plan and yet miss out something important which could later cost you dearly.

Take British people who live overseas (Expats) as an example. Many people living abroad believe that they will not have to pay Inheritance Tax when they die due to their residential status, yet the reality is that most people will have to pay Inheritance Tax on their UK assets.

Mistakes like these can come as a nasty surprise later. So it does pay to consult a professional about your financial plan, helping to ensure that you have not missed out anything important.

Getting Better Deals

There are many areas of financial planning where it is possible to pay more than you need to. Take investment management fees as an example.

You might have an investment portfolio which you feel is performing well. Yet if you are paying excessively high fees which eat into your investment returns, then over many decades these could, effectively, represent a “loss” of tens of thousands of pounds.

We will help you to review your portfolio, scan the wider market and help you find the best deal for your needs and goals. Even a slight reduction on your investment management fees, for instance, could make a huge difference to your standard of living later on in retirement.

Minimise Threats

Did you know that in 2018 many people were scammed out of their pensions by fraudsters, costing each victim an average of £91,000? Whilst having a decent Financial Planner on standby is not iron-clad protection against receiving a malicious cold call, a trusted financial planner can help you discuss any unsolicited offers and avoid making costly mistakes with your money.

Simplify Everything

As mentioned above, many areas of financial planning are deeply complicated (such as pensions). A good Financial Planner will help to bring clarity to the world of Inheritance Tax, Income Tax, National Insurance, ISAs, Annual Allowances and more to help ensure you understand it. Moreover, this person can also help you bring different parts of your wealth together. This can not only make things more tax-efficient but can also simplify everything.

For instance, perhaps you are nearing retirement and have over a dozen pension pots scattered around due to a long, successful career in different lines of work. For many people, it can help immensely to consult a Financial Planner who can help consolidate all of these separate pots into a central pot, making everything much easier for you to manage.

Final Thoughts

There are many other benefits to a Financial Planner in addition to the above. For example, this person can help you to manage the emotional rollercoaster of investing. After all, your investments are likely to experience a lot of volatility and it can be tempting to act impulsively.

A Financial Planner can also help you to delineate the areas of your finances and wealth where you can exert control, and where you cannot. They can then help you to focus your energies on the former, allowing you to better relax and enjoy more peace of mind.

If you are interested in speaking to us here at FAS about your financial plan, then we’d be delighted to hear from you!