How financial planners help you obtain financial security

A life of financial security gives you peace of mind that you and your family are protected. What you need to do now is to get started. A financial planner can show you how to get there.

Let us share you the story of Jessica. When Jessica landed her first role as an advertising intern, a life with financial security didn’t seem to be on the cards. That role barely paid minimum wage. However, it also offered the potential for massive increases over time, as long as she put the work in.

Very early in her career, Jessica recognised the importance of having a financial plan so she worked her way up the ladder, developing that plan so she could create the life she wanted.

As she puts it:

“To meet my savings goal, I set a very detailed budget, with limits for everything from groceries to entertainment. I also follow the 24-hour rule when shopping – I wait to see if I’m still thinking about an item the next day before making a purchase.”

The result?

At age 27, Jessica has $30,000 in her savings account. Now, she looks at how to invest and grow those savings so they can start earning money for her. She’s well on her way to financial security, thanks to her plan. But if she’d started a little before hitting the $30,000 mark, she could be even further along.

Could working with a financial planner help you do something similar?

Before we get to that, it’s important to answer a key question…

What is a financial plan?

A financial plan is a big picture of your current finances and your financial goals, as well as the strategies you’ve set to achieve those goals. It acts as a guide as you go through life’s journey. Typically, it involves setting current and long-term financial goals for yourself. It also documents the actions you plan to take to reach those goals.

For example, Jessica’s long-term goal is to have $100,000 in savings. Actions such as limiting her spending on entertainment and leisure travel helped her to move towards that goal.

You can create a financial plan by yourself, or with the help of a financial planner. Either way, the key is to develop an understanding on your current position so you can start working towards your future.

How can a financial planner help me create lifestyle choices?

Your ultimate goal is to create financial security. Of course, this is a fairly loose term that means different things to different people. For some, early repayment of a mortgage means financial security. For others, having enough savings for an amazing retirement is the real goal.

Whatever your definition may be, a financial planner may help you create that lifestyle.

Your planner can help you to do all of the following:

  • Define financial goals and a strategy to achieve them
  • Create an investment plan based on your current position and what you hope to achieve
  • Minimise tax using appropriate strategies
  • Create a budget that will help you lead the lifestyle you want, without overspending
  • Plan for your retirement
  • Protect any assets that you hold
  • Make full use of your superannuation

But it’s not just about money. A good financial planner can help you create confidence. That’s the conclusion of a survey that IOOF conducted. They spoke to 12,643 individuals about the effects that financial planning had on their lives.

The survey found that 90% of the advised clients have left them in a better position. 41% also had better relationships with their families and friends.

So, a financial planner may be able to help you create the financial security you’re looking for. And it’s also possible that they can help you improve your overall happiness.

What might my financial plan include?

The answer to this question depends on the specific purpose of your financial plan. It needs to address your personal definition of financial security – that’s why it is important to work with a planner who understands you and your needs.

A financial plan may include the following:

  • Documented financial goals
  • A strategy to achieve goals
  • A calculation of your current net worth
  • Information about your current cash flow
  • A retirement strategy
  • An investing strategy
  • An estate plan
  • A risk-management plan, which may include insurance policies and similar vehicles
  • A tax minimisation strategy

The key point here is to have clear goals for the plan. Start with the end in mind so you can map out the steps needed to achieve your goals.

How does financial planning affect cash flow?

Your financial planner may talk to you about your current cash flow.

Understanding your cash flow means knowing where your money goes. It involves determining your income, anything that brings you money and highlighting all of your expenses. The goal is to generate enough income to cover those expenses. Once managed, you may have a positive cash flow and can be in a better position to save or invest. But if your expenses exceed your income, it may be the opposite and give you a negative cash flow. If you don’t rectify the issue, you’ll likely fall deeper into debt.

A good financial plan may help you be in control of your income, reduce expenses and investments so that you can manage your money and achieve your goals. This means you have more money to spend on other expenses such as bills and to execute better aspects of the plan.

How often should I speak to a financial planner?

A good financial plan does not end with creating a plan. Situations change over time and it may affect your goals and your future environment. This means you need to revisit your plan regularly to confirm that it still serves your needs.

Regular meetings with your financial planner will give you a chance to revisit the plan and make adjustments for any required changes.

It’s time to create your plan

A good financial plan can play a huge role in creating your financial security. It helps you understand yourself and your current situation, as well as create strategies that bring you closer to your goals.

The key is finding a suitable financial planner. This planner can help you create a plan that’s relevant to your situation.

And that’s exactly what Banks Group can offer to you.

The Banks Group experts are ready to assist you in your journey to financial security. Book an appointment today to find out how our financial planners can help you.

Remain focused on achieving your financial goals. Watch and learn from the Banks Group experts as they share their insights on how you can plan and protect what’s important for you and your future. 

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This article is intended for general discussion and is not intended to represent specific advice. Banks Group shall not be responsible for any entity that acts on any of the comments in this article without first obtaining specific advice from Banks Group. For further information, please click here.

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