Planning Your Investment Needs

Planning Your Investment Needs

Planning Your Investment Needs

Planning Your Investment Needs

The world needs financial advisors because people have difficulties when planning for their future. Its not only the acquired knowledge that's needed, but also time-saving incentives. The intended outcomes for the receiving party could be financial stability, early retirement, etc. Finding trust in someone to handle your future needs can be difficult. This is why its important for the client to be open-minded and ask many questions. This will indicate whether the clients' future is being trusted in the right hands. This article will help tackle the issues people face when overcoming their financial barriers, and what to be aware of when having someone else help you make these decisions.

Before anything is said and done there should be a legitimate understanding between the advisor and the client. The letter of engagement is a document that outlines the investment plan. The document will include how this plan will be recorded over the preceding period, the exchange in services along with time deadlines, what is being expected out of both parties, and the compensation structure. The letter acts as a plan, and proof of the engagement. This will create an understanding from both parties of what is happening.

Once the letter of engagement has been established, the clients' needs have to be recognized. In order for this to happen, information about the client has to be extracted by the advisor. This is done through many questions. The advisor will ask questions that are personal and financial related. Such questions could relate to assets owned, investments, dependants, etc. The more information the advisor has, the better recommendation he or she can give. This is because there will be more information to work with. The information will also help indicate regular spending habits. Thus more realistic financial goals can be set.

Since information is being revealed about the client, the advisor is able to find out about any issues or problems that stand in the way of achieving financial goals. Basically these are obstacles that come in the way. Both parties are expected to work through these issues and understand them thoroughly. Once all the right information is found out, the advisor is able to take the information away. The advisor can seek assistance from its sponsoring institution to help build a plan for the client. These plans will necessitate to the needs that were understood previously. Once a plan is structured, it can be revealed to the client in the form of a presentation. This plan should include solutions to the questions faced previously. Thus appropriate strategies are being presented to accommodate the clients' desire for meeting financial goals. This would include the responsibilities for both parties. What is being expected from both sides.

If the plan is liked by the client, then implementation follows. Which means there will be a signed agreement from both parties. The duties of both the financial advisor and the client are agreed upon. The client may have to send funds at certain times whereas the advisor may have to allocate these funds in the right place. This is an example of the many different expectations that have to be fulfilled from both parties. Once the plan is concrete, the financial advisor has to monitor frequently. With monitoring comes responsibilities to inform the client on a regular basis. This will also bring up the opportunity to collect new information about the client (salary changes, additional recurring payments, etc). This is important because the plan has to fit with the new lifestyle changes of the client. Thus frequent updating and maintenance of information is required.

Written by Basim Mirza

Sources Used:

The Canadian Investment Funds Course. Incentive Financial Sector Education (2007).

POST COMMENT

All about risk and durations in Investment Siding is an investment that looks and feels good Russ Whitney-Usefulness in any Genuine Property Investment Qualities Property Investments - Seal A Quick Deal! Property Investments - A Permanent And Safe Investment Prompting Investment in Colombia due to Oil Blooming and Mining Introduction to International Property Investment Systematic Investment Plan SIP – An Investment Mantra for growth of your wealth Cd Rates: How They Affect Your Investment Becoming a Millionaire With The Right Investment in no Time Masterpiece Investments Return On Investment- Methods To Improve It Do Not Expect A Return On Your Emotional Investment