Financial Brokers provide financial advice and guidance to customers and it’s usually called financial planning. The term financial planning can cover a multitude of activities and tasks but when Financial Brokers speak about financial planning they mean something very specific indeed. Financial planning for them is working with their clients to understand the client’s financial needs, goals and desires and then putting in place a plan to address those issues.
The process begins by learning about you and getting a picture of where you stand financially. It means looking forward and taking into account future events and goals such as retirement and children’s education. There are certain events that might occur that will make those goals achievable such as death, illness, loss of a job etc. A financial broker will set out ways that you can best protect yourself and your family from harm.
When planning for events that require cash in the future, a financial broker will firstly conduct a risk assessment to establish how much risk you are comfortable with and how much risk you are able to take or are required to take, in order to achieve your financial goals.
They complete a financial model of your current financial situation that will project current information into the future and give a very visual presentation of how your financial life will evolve, given what we know now. It takes account of inflation, growth rates and taxation and shows where shortfalls might occur.
They make financial planning recommendations that address your goals, based on the information provided. They will go over the recommendations with you to help you understand them so that you can make informed decisions. They will also listen to your concerns and revise the recommendations as appropriate.
The financial broker will carry out the agreed recommendations or serve as your coach, coordinating the process with you and other professionals such as solicitors, accountants or stockbrokers. Financial brokers will monitor your progress towards your goals and they will report to you periodically to review your situation and adjust the recommendations, if needed, as your life changes.