Insurance and Credit

When looking for a financial advisor, it can be very complicated to find a trusted personality who will provide sincere analysis and guidance to your decision-making in your investment choices. Look for these sets of criteria when searching for your financial advisors.

Start by scrutinizing their education and experience on finance management. Are they recommended by friends or trusted peers? Do they have familiar clients who have entrusted them with their transactions?

Veteran financial advisors have both the education and experience. Education provides them with the necessary knowledge in our complex global financial system. Since their main function is to gather financial information, analyze it, and make recommendations, they should be well an expert in the field already.

Moreover, their experience is a very good indication of their confidence to guide you through great deals. With their experience, you will definitely notice that these persons spend a lot of time working with people. Thus, they really developed their communication skills.

Another consideration you should always iron out is to resolve how these advisors are paid. Expect financial advisor to be paid in three different ways. When taking his time and using his expertise, you can expect to pay him with an hourly rate, a monthly retainer, or commission-based. Be very keen with your agreement in payments so as to avoid ending up regretting your choice.

As a tip, prefer the hourly rate or monthly retainer rather than paying your advisor on a commission basis. Usually, when paid with commission on trades, they may recommend changes, which can be unnecessary or even harmful, in your portfolio. This is because they have the motive of increasing their commission payments. This is what we need to avoid getting a biased and probably bad investment deals.

Your main purpose in getting a financial advisor is for an expert to guide you in intelligent decision-making. As their role is to assist you in the planning and arrangement of financial affairs, such as your retirement provisions, you need to have a loyal one behind your back. By ensuring the financial advisor’s track record with his career, you will found out that he will certainly understand your financial situation in the first place.

Finance can be very intimidating and a good financial advisor will be responsible to make sure that a client’s risk is minimized. By taking the time to look for the best financial advisor, you prevent yourself from a future of stress and frustrations.

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Times are different. Markets have changed. The economy is tumbling to historical lows. People who loved getting those great returns in the stock market have not only lost their gains, but their principal too.

“It’s not so much a return on your money than a return OF your money that’s important”, Warren Buffet once said. Many Americans would have surely enjoyed a 0% return on their investment in 2008, rather than the depressing negative returns they received.

Is there any such vehicle out there that still gives a decent rate of return, but with protection from any downside risk?

Retirement vehicles that are directly tied to the stock market, such as IRAs, mutual funds and 401Ks have been impacted so terribly that Americans who were planning to retire in 2009 must work at least 10 more years, just to break even!

Did anyone see this coming? Many experts did, but had no idea when and to what extent of turmoil our country and world, for that matter, was going to suffer. But how long must we suffer?

If one find the right tools, slowly re-constructing their financial state, one can still create the retirement they once dreamed of. Obtaining the right financial planner is necessary.

Only 4% of Americans will reach retirement, according to the Social Security Administration. (Source: U.S. Department of Health and Human Services, SSA Pub. #13-11871). Studies also show that only 4% actually seek the help of a financial advisor.

To make matter worse, not all financial planners give the best advice. They do not always serve the best interests of their clients. Does it really make sense that an advisor should get paid to lose your money? It happens all the time, even now, as you read this.

A great financial planner will aid you in battling these two important matters: taxes and inflation. The 4% minority becomes financially independent because they have successfully beaten these two battles.

Imagine if you didnt have to work another day in your life. You had put away enough into your nest egg, safely, so that the return from that nest egg paid you even more than what you make now on a monthly basis. What if you worked only because you wanted to make a difference in other peoples’ lives? But your life was basically a life-long vacation. And you could do whatever, whenever, however, with whomever, without having to worry about money.

Sounds like a pretty good definition for retirement. True financial freedom is within your reach.

What is Personal Financial Planning?

Personal financial planning is simply expert guidance on personal financial decisions in order to satisfy life needs and goals. It may also include portfolio decisions and fulfillment of portfolio needs through various products or choices.

Why do I Need Personal Financial Planning?

Financial planning allows you to organize your finances in such a way as to maximize returns on investments, reduce tax liability, achieve appropriate risk management, and ultimately obtain financial peace of mind.

But Can’t I Just Do It Myself?

That?s possible, but will you actually do it? Most have found it to be increasing difficult to adequately plan for their financial growth and security. Their most common roadblocks to personal planning have been:

- No time

- Too many different investment opportunities

- The complexity of ever-changing tax laws

- The entwining of employee compensation and benefits

What is Generally Included in a Financial Plan?

The length of the plan is based on the complexity and specifics of each individual situation. The typical plan can be anywhere from 10 pages to 150 pages and includes:

- Cash Flow and Budgeting Analysis

- Debt Management and Investment Portfolio Assessment

- Estate Planning and Liquidity Analysis

- Income Tax Projections

- Retirement (forecasting benefits, costs and options)

- Insurance Needs Assessment

- Educational Funding

- Employee Benefit and Holdings Analysis

- Closely Held Business Planning

What is My Role in the Planning Process?

Your role in the planning process is to provide as clear and concise information to the planner as you can. They should clearly understand your goals, dreams, attitudes, and positions. Your planner may meet with you annually to update this information.

Are Fees for Financial Plans Tax Deductible?

Yes. Expenses for investment and tax planning are deductible as itemized expenses, subject to limitations – IRS Section 212.

How Can I Measure the Worth of Financial Planning?

Once the planner has assessed your situation and made recommendations, you should be able to compare the projections with the cost of the analysis. Your planner should have presented data that more than paid for the expense of the plan.

Will Personal Financial Planning Make Me Rich?

Lamentably, get-rich-quick schemes just don’t really work. For this reason it is ever more important that you receive proper and accurate financial planning advice. A good plan will help you keep more of the money you earn and help the money you keep work for you. It does this by:

- Productivity of assets are increased

- Providing capital growth and security for your family

- Better risk management

- Providing participation in new investment opportunities

- Increasing disposable income through tax savings

- Investment alternatives are provides closer inspection

- Minimizes the negative effects of disability, early retirement, and death