The Financial Planning Process
FPSB’s Financial Planning Process consists of six steps that financial planning professionals use to consider all aspects of your financial situation:
Establish and define the client-planner relationship
The personal financial planner should clearly explain and document the services that he or she will provide to you and define both his/her and your responsibilities during the personal financial planning engagement. The personal financial planner should explain fully how he or she will be paid and by whom. You and the planner should agree on how long the professional relationship should last and on how decisions will be made.
Gather client data, including goals
The personal financial planner should ask for information about your financial situation. You and the planner should mutually define your personal and financial goals, understand your time frame for results and discuss, if relevant, how you feel about risk. The personal financial planner should gather all the necessary documents before giving you the advice you need.
Analyse and evaluate your financial status
The personal financial planner should analyze your information to assess your current situation and determine what you must do to meet your goals.
Develop and present financial planning recommendations and/or alternatives
The personal financial planner should offer financial planning recommendations that address your goals, based on the information you provide. The planner should go over the recommendations with you to help you understand them so that you can make informed decisions. The planner should also listen to your concerns and revise the recommendations as appropriate.
Implement the financial planning recommendations
You and the personal financial planner should agree on how the recommendations will be carried out. The planner may carry out the recommendations or serve as your coach, coordinating the process with you and other professionals such as solicitors, accountants or stockbrokers.
Monitor the financial planning recommendations
You and the personal financial planner should agree on who will monitor your progress towards your goals. If the planner is in charge of the process, he or she should report to you periodically to review your situation and adjust the recommendations, if needed, as your life changes.