More than investments
Investing is often the last piece of the puzzle. Before that, a financial planner will look at things like your income, spending, pensions, tax position, family commitments, and longer-term goals. A good financial plan brings all those pieces together so you can see the bigger picture, rather than looking at them in isolation.
For example, you might be investing money but not using your ISA allowance, which could mean you’re paying tax you don’t need to pay. Financial planning is about spotting those sorts of things and helping your money work harder for you.
What can financial planners help with?
People often come to a financial planner when life gets complicated, or when they’re facing changes such as approaching retirement, receiving an inheritance, selling a business, taking a career break, supporting children or ageing parents, getting divorced, or simply wondering whether they’re making sound financial decisions.
Financial planning can help with practical questions, such as how much to contribute to a pension or how to make better use of savings and investments. But it can also help with bigger life questions.
Some people need help with one specific question, such as “can I afford to retire?”, while others want ongoing support and regular reviews. Both are valid. It really depends on what you need.
Your financial plan should adapt as your life changes. Even if nothing major has happened, such as a change in your working or family circumstances, it’s helpful to check in regularly and make sure your plan still works for you. Think of this as a financial health check.
When can a financial planner help?
You don’t need to be facing a crisis, and you don’t need to have everything figured out before contacting a financial planner. Many people tell me afterwards that they wish they had spoken to someone sooner.
Consider whether you need support with a financial decision. I’ve seen people make decisions that ended up costing them more than advice would have. Not just financially, but emotionally too.
A good financial planner will never make you feel judged for past financial decisions. I’ve yet to meet anybody who thinks they’ve made every financial decision perfectly, me included. It’s never too late to improve your financial habits. A good planner will take where you are today and help you look forward.
What does the process with a financial planner look like?
The first meeting is really just a conversation, and much less intimidating than you might expect. We’ll talk about you, your family, your finances, and what you’d like your future to look like. We might discuss pensions, savings, investments, income, spending, and any other concerns you have. At the end, I explain how I think financial planning could help, and you can decide whether I’m the right person to support you.
You don’t need to turn up with spreadsheets or a fully formed plan.
Think about what prompted you to make the appointment and any questions or worries. If you have information about your pensions, investments, savings, mortgage, or other financial arrangements, that can be helpful – but don’t panic if you don’t have everything to hand. There’s a lot to take in at a first meeting. A good financial planner will tell you what they need you to bring if you decide to meet again.
If you decide to go ahead after the first meeting, the planner usually gathers more information, analyses your situation and builds a financial plan based on what you want to achieve with your money. They should talk you through the plan and their recommendations, make sure you understand, and give you time to reflect before making decisions. At every stage, your planner should explain what happens next.
What does financial planning cost?
Costs can vary, so it’s important to ask. Many firms offer an initial conversation without charge, while others charge straight away. Some planners charge fixed fees, some charge hourly rates, and others charge a percentage of the value of the investments they give advice on.
A good financial planner will always be clear about the cost of their advice. The fee should be agreed before any work is undertaken.
Remember, there are no stupid questions about fees, just as there are no stupid questions about money.
What’s the best way to find a financial planner?
Finding the right planner is important. Qualifications and experience matter, but so does trust. You’ll be talking about your money, your family, your ambitions and more, so you need to feel comfortable with the person you choose. You can find a financial planner through recommendations from friends and family, adviser directories such as Unbiased or VouchedFor, or by contacting a financial planning firm directly.
Some firms do take on clients at a certain wealth level, so it’s worth doing your research. If you’re not sure, just ask.
Whichever route you choose, always check that the individual or firm is authorised by the Financial Conduct Authority.
Don’t be afraid to ask lots of questions, including: What sort of clients do they usually work with? What qualifications and experience do they have? How are they paid? What does the planning process look like? How often will you meet? What support can you expect after the advice is given?
Pay attention to whether they explain things clearly. A good planner won’t confuse you with jargon.
A final note
Money can easily become something that sits on the ‘I’ll sort that out one day’ list. A new client recently told me that speaking to a financial planner had been on her list for so long that just having a quick coffee with me felt like a huge step forward.
For women in particular, I would encourage you not to wait until everything feels perfectly organised before having a conversation. You don’t need to have lots of money or your life completely organised before speaking to a planner. You are investing in yourself and your future. It’s never too late to get savvy about your money. You work hard for your money; make it work hard for you, too.
If you want to dip your toe in before considering speaking to a financial planner, Rathbones offers free online financial awareness courses for women, designed to help them feel more confident about money and long-term financial decisions. That could be a first, no-commitment step to thinking about these topics.
Rebecca Williams is a Financial Planning division lead at Rathbones, a UK wealth management company providing investment management and financial planning services. Find out more.