What Do Financial Planners Do?
August 24, 2017 .

When people ask what Plenty is and we reply that we are “online financial planners” we usually end up with blank stares or a vague “that sounds interesting”. When we dig a little deeper it’s clear that people can’t actually answer the question What do financial planners do?

It’s a Process

Financial Planners (the good ones anyway) generally follow a process – that process will leave you in a better position to reach your life goals. The process with Plenty, and many other planners, generally looks something like the below:

Financial Planning Process At Plenty

It Begins With You

The first step in the planning process is to understand your current financial situation – how much you earn, how much you spend, where do you spend it, how much debt you have, what are your assets etc. The planner should dig deep to get a thorough understanding of your position.

Your Goals

Once your financial position is understood it’s time to tell the financial adviser your goals – is it your retirement you are worried about? Buying a family home? Buying an investment property? Clearing your debt?

The Strategy

Once your goals are understood it is the planners time to formulate a strategy to help you reach your goals. A key part of the strategy will always be a budget – a planner should help you understand where your money is currently going and what you have to do with your money to reach your goals. Beyond a budget the planner should formulate strategies for your investments, debt, superannuation, insurance, retirement – all these strategies should put you in a better position to reach your goals. These strategies are presented to you in a financial plan (or as we like to call it – a roadmap) which will show you how to reach your goals. You can see what ones of these roadmap’s look like with Plenty here.

Your Very Own My Miyagi

Sticking to your financial plan will take some hard work and discipline and planners should be there to instil that discipline. The planner should also be there for you when your goals change – life is not stagnant and neither should your strategy; constant monitoring and contact should be an important part of a financial advisers role.

The Problem

The above sounds pretty good, right? Less stress about money and a chance to reach your financial goals. Then why would only 20% of people will ever go through the process discussed so far? There are a few interconnected reasons to why more people aren’t getting advice:

  1. The Cost – Simply put – advice is very expensive (we did a whole blog post on the cost of financial advice). For the process described so far you are likely to pay $2,500 up front and approximately $3,000 per year on going; this is a tough pill to swallow.
  2. The Time Investment – As it currently stands it will take 2-3 meetings and over 6 weeks to get your roadmap – it might then take similar amount of time to get it implemented. In those 3 months you are also likely to have to fill in lots of forms many times answering the same questions.
  3. Trust – A majority of advice providers are connected to just 6 financial institutions. Over the last 5 years alone these 6 institutions (the big 4 banks + Macquarie & AMP) have been forced to compensate close to $500m (and counting) due to scandals in their financial planning divisions. Each one of these scandals has also gotten a lot of press coverage which has done no favours to the industry.

The Solution

Financial Planners do a lot but they also cost a lot, take a lot of time and it’s hard to find a good one. Digital advice providers, like Plenty, can solve for these problems:

  1. Cost – Plenty can get you a financial roadmap for free and your very own My Miyagi for just $59 per month
  2. Time –getting a roadmap takes less than 15 minutes. Furthermore, we are online which means you can access us anytime, anywhere.
  3. Trust – our advice is programmed to do only one thing – put you in the best financial position possible.

So check us out and get your free financial roadmap with Plenty now.

The information contained on this page is of a general nature and may not be appropriate for your personal circumstances. You should obtain personal financial advice before acting on this information.

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