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Question:
Does everyone need a financial plan?
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Answer:
Absolutely! Not everyone needs a “written”
financial plan however. Sometimes a plan can
be mapped out in an outline format to cover
all the basics. Everyone should plan for the
future. Setting goals for the future and reassessing
them each year will increase your chances for
success. To build an “ark” to weather the inevitable
storms of life, you must begin by assessing
what available tools you have with which to
build it (your assets, cash flow, etc.), designing
your “ark” (your plan), building your “ark”
(implementing your plan) and then monitoring
the course you’ll sail (annual reviews).
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Question:
How do financial planner fees work?
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Answer:
Financial Planners work with clients in many
different ways. Fee-only planners charge a fee
and make no commissions. They do often time,
also charge a fee to manage your assets. For
most clients, these fees can be more than one
wants to pay. Most financial planners also are
licensed to sell investments and insurance.
In this case, they are paid by the companies
whose products they provide
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commissions. When working with a planner on
a commission basis, there is a potential conflict
of interest if the planner chooses products
based upon the commission paid rather than the
need of the client. However, if a fee-only planner
only recommends his portfolio management service
and doesn’t include other types of investments
and managers, that can be a conflict as well.
That’s why it’s important to choose a planner
who is ethical and places your needs first.
You can count on being placed first at The Planning
Team. We are available to work with clients
on a fee-only basis, fee plus commission basis
or commission-only basis. |
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Question:
When should someone begin to plan for retirement?
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Answer:
NOW. If a person begins to work at age 22 and
begins saving 10% of his or her income (that
includes any contributions by employers to 401k
plans), that person may never have to worry
about retirement. If he waits until he’s age
50, he’d need to save substantially more of
his income if he’s saved nothing up to that
time. Putting off saving for retirement can
be devastating to your future. |
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Question:
What will financial planning do for me?
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Answer:
Financial planning came into being to solve
a need -- COORDINATION. Clients used to go to
the insurance agent for insurance, to the broker
for investments, to the lawyer for wills, to
the CPA for tax advice, etc.. Yet none of these
advisors looked at the client’s entire picture.
Coordinating all the areas a financial life
can save a lot of money for the client – correct
amounts and types of insurance will be chosen,
investments that also fit the tax profile of
the client may be used, proper estate plans
will be utilized, etc. A financial planner will
eliminate the often conflicting advice that
a client receives from having so many different
advisors. Can you imagine a sports team ever
winning a game if there were no game plan or
coach? The financial planner is your coach but
you own the team – you make the final decisions. |
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