Things to Know Before Hiring a Financial Planner

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Things to Know Before Hiring a Financial Planner
Elston Partners
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Never thought about hiring a financial planner?
Think you can manage quite nicely by yourself,
don't worry you are not alone, but that doesn't
make you right. Virtually anyone with a moderate
to high income could benefit greatly from the
expertise they bring to the table. By financial
planner we mean someone with the expertise to
produce a financial plan for an individual
household or company. They have a good knowledge
of accounts, tax planning, investments and estate
law to mention a few of their areas of
expertise. This is not to say that a financial
planner is an expert in all these fields. It
might be useful to view them as a General
Practitioner, a doctor trained to treat a wide
variety of illnesses and health issues.
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He can give you a health checkup and provide the
cure to your disease or illness. However if he
finds a problem he can't solve or he doesn't know
enough about, he will send you to a specialist
which has more experience in that specific area
of expertise. A good planner will do precisely
that, give you the advice you need or at the very
least help coordinate your financial planning
with your accountant, insurance agent, investment
professional and estate lawyer. You might have
avoided hiring one because you felt it would be
too expensive but if you have a large income you
could save a fortune by hiring a planner that
will help you avoid expensive financial mistakes
that could seriously damage your financial health.
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The next question is how to choose the right
planner? The first step when looking for a
financial planner is to only hire someone that
can prove they are certified in financial
planning. There are a variety of associations
that provide certification in Financial Planning
two that are highly recommendable are the
Certified Financial Planner and the Personal
Finance Specialist, given only to qualifying
Certified Public Accountants. The second step is
to ask for recommendations from people you
respect that can provide positive feedback on the
financial planner in question. This is probably
the safest method as the best trained financial
planner is no good to you if he doesn't have the
interest of his clients in first place.
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The third question is how much it will cost you
and how they will receive compensation. If the
hiring fee is too large any saving the financial
planner makes might not be worth the effort. They
fall into two broad types, fee-only financial
planners, and commission and/or
fee-based. Fee-only planners charge you for
their advice by the hour. They analyze your
situation and suggest the steps you should make.
Pretty straightforward, this is why many are
attracted to this type. On the other hand
commission based planners charge an asset based
fee, typically 0.5 to 1.5 of your assets.
Remember that this fee is charged annually and
that financial planners will generally invest
your money in a mutual fund that also charges a
management fee annually. Financial Planner
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Thank You
Call Us 1300 ELSTON (1300 357 866) Email Us
info_at_elstonpartners.com.au