Just what is financial planning?

Financial planning is a term that has been applied to a number of processes relating to the management of financial resources by individuals, non-profit groups and multi-national corporations. However, an exact definition of financial planning can be difficult to construct. According to Patrick Whelan, an Australian financial consultant, “Financial planning is the process of developing strategies to help you manage your financial affairs so you can build wealth, enjoy life and achieve financial security.” When a financial planner develops a financial plan (or ‘statement of advice’) just for you, he or she will follow a carefully structured process to guarantee the best outcome for both you and your financial affairs. The planning process begins with the identification of goals by both the financial planner and his or her client that will be focused on during the course of the financial planning. Following this, the financial planner will collect all of the information from the client necessary to formulate an efficient strategy designed to enhance your financial situation.

Thirdly, the financial planner will analyse the information collected and decide whether the client’s goals are realistic, based on the financial resources available. Next, the financial planner will construct a personalized financial plan for the client, as well as helping him or her to implement that plan. The sixth and final stage in the process of financial planning is the review stage. At regular intervals, the financial planner and the client will meet to ensure that everything is running smoothly. If it is not, he financial planner will revise the plan to maximise the benefit for his or her client. Financial planners are regulated in different ways, depending on the jurisdiction concerned. For example, in the United States, all financial planners must first be qualified and registered as investment advisors. In many countries, a separate examination must be passed in order to receive certification as a financial planner, similar to the ‘bar exams’ in place in the United States for lawyers. The Certified Financial Planner Board of Standards was originally an organization confined solely within the borders of the United States, although today the Board is recognized internationally for its standards. You can find a financial planner in your area by doing a simple search. If you’re lucky enough to live in Alaska, you might want to search for Anchorage financial planners in order to narrow your search down a little. You should make quite a saving too!