Four Reasons Financial Planning is Valuable

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Published by Taylor Financial Group

Creating a financial plan is arguably the most important thing you can do for yourself and your family.  Financial planning helps you figure out what your goals are and the best way to pursue those goals.  But, because creating a financial plan involves many different elements and requires strategic thinking, including financial, tax and legal considerations, it is important that you have the guidance of a financial planner.  Here are just five (of many) reasons financial planning (with an advisor) is valuable.  Indeed, both Vanguard and Morningstar have conducted studies on this topic and have concluded that an advisor can add up to 3% in additional returns per year if they are providing advice on these areas.

Improve Financial Understanding
Making sound financial planning decisions can affect your entire life.  The decisions you make about your finances extend beyond your investment choices.  It’s about short-term and long-term thinking, and making sure you have enough money for all stages of life.  But how can you be certain that you’re making good decisions if you don’t have the right knowledge and education?  That’s why it’s so important to have a financial advisor who is a fiduciary and can answer your questions and guide your decision making, while acting in your best interest.

Effective Income Management
Part of helping you make good financial decisions is making sure that you have the proper income, regardless of where you are in life.  And also making sure you’re planning for the level of income you will need in retirement.  It’s difficult to determine these different amounts unless you have the right tools.  A financial advisor can help you with all sorts of new technology aimed at helping clients envision their future and consider different scenarios.  At Taylor Financial Group, we use WealthMatch, our personalized financial planning program, to help our clients see the possibilities.  WealthMatch helps us illustrate how financial decisions and spending habits today can impact your plans for the future.  Now, with our newly released WealthMatch Sandbox, you can participate in a short exercise, and answer questions about yourself and your future objectives, so that we can build a plan to help you pursue your goals.

Maximize Retirement Savings
Once you’ve considered the possibilities and imagined the difference scenarios, you are on your way to maximizing your retirement savings.  But this is not a one-and-done deal.  Planning for retirement requires proper implementation of key components, constant monitoring of your financial plan, and course corrections when necessary.  It also requires consideration of all possible retirement income, some of which are ever-changing.  For instance, Social Security and Pension benefits can be very complicated, and tax laws related to these can significantly impact how they will contribute to your retirement.  Moreover, as we discussed in a recent blog, healthcare expenses in retirement can have a serious impact on your retirement income.  So, considering long-term care insurance is a must.  The list goes on and on — retirement planning is complex and that’s why it should be done with the advice and guidance of a financial advisor.  And studies show that close to 50% of investors don’t even know how much income they will need to rely upon in retirement, let alone have a plan on how to get there.

Ongoing Advice & Guidance
Without a financial advisor, the overall process of financial planning can be overwhelming and things can slip between the cracks.  Letting the ball drop on your future is not something you want to do.  That’s why we make sure we hold meetings with our clients at least annually to review their situation and find out if anything has changed in their current circumstances and in their plans for the future.  Many times, clients don’t even realize that small changes in circumstances can have BIG consequences.

We realize financial planning can be overwhelming and confusing.  But we can help you create an effective game plan to help you pursue your goals.  Get started now by taking this quick quiz and gain access to your own dashboard, where you can organize your financial priorities and begin to create your personalized plan.

Sources:
-Putting a Value on Your Value: Quantifying Vanguard Advisor’s Alpha, Sept. 2016
-Morningstar Magazine, June/July 2017
-Nationwide, Health Care Webinar, June 2017
 
The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine what is appropriate for you, consult a qualified professional.
 
Securities offered through Cetera Advisor Networks LLC, Member FINRA/SIPC. Investment advisory services offered through CWM, LLC, an SEC Registered Investment Advisor. Cetera Advisor Networks LLC is under separate ownership from any other named entity.

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