A financial planner is a professional who analyzes your financial status and helps you manage your assets. These professionals offer services like tax, retirement planning, insurance, and estate planning.
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You will receive a customized financial plan to help you achieve your goals and prevent unnecessary expenditures. The plan is created based on the information you provide and includes tailored recommendations.
Qualifications
Financial planners help clients to invest and save money. Financial planners also help clients plan for retirement, other life events and manage taxes and insurance.
Financial advisors might need to get a license depending on the job they do. If they are selling these products, they may be regulated also by real estate or insurance agencies.
Employers prefer candidates who hold a bachelor’s degree in business, finance or accounting. Some schools provide courses on risk management, taxes, and investments to prepare students for this field. A master`s degree can also increase employment opportunities and salary.
Fees
A financial planner can help you save for your child`s college education, plan for your estate, and much more. You may be charged a flat rate, or an hourly fee based on AUM.
In 2012, the FPA study showed that a comprehensive financial planning service cost on average $2250. This is significantly lower than the cost of managing your portfolio yourself, for example through a robo-advisor.
In fact, when you consider all the different types of business models advisors have to work with (standalone planning, retainer, project-based, and hourly), it appears that the cost of financial planning is largely a function of the physical plan itself rather than any implicit time costs.
This is likely due to the varying degrees of complexity of plans. Some clients can create a simple plan on their own while others need the help of an expert advisor.
Types of Clients
Financial planners work with clients of all backgrounds. Their services may include reviewing investment portfolios, managing retirement accounts, tax planning, estate planning and insurance advice.
In many ways, the best way to differentiate yourself as a financial planner is to focus on your own unique niche. This can be done by focusing on ways to make clients happy and serve them in their best interest.
You can also identify what challenges your target market is up against that other advisors might not be addressing. If you can provide a service or experience that will help your clients, it will make a big difference to them.
For example, you could offer a unique experience to your clients such as helping them lose weight. It would be an excellent way to differentiate yourself from your competitors and you might even gain some media attention.
Reputation
Financial planners need to maintain a good online reputation, because their jobs depend on it. Consumers often look for reviews of financial planners before choosing one to work with.
A review of a planner`s performance can help you evaluate his or her qualifications, fees and services. You should also find out how the planner is regulated, and if there are any conflicts.
Consult the professional associations from which the planner obtained their designations. These include the State Board of Accountancy for accountants; the State Insurance Department for those who sell insurance products; and the Real Estate Commission for those who sell real estate.
Word of mouth can also be used to determine the reputation of financial planners. You can ask your friends and colleagues about their experiences with financial planners.