Financial Planning Helps You See the Bigger Picture

Financial Planning Helps You See the Bigger Picture

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2015-07-09

 

No matter what the goal is - owning a new home, traveling to exotic locations, driving a nice car, starting a business or retiring comfortably -  there is always a price tag attached.

That's why financial planning is so important.  Financial planning is a process that can help you reach a goal by evaluating your whole financial picture, then outlining strategies that are tailored to your individual needs and available resources.

The Financial Picture

Think of your financial needs and goals as a picture. A comprehensive financial plan serves as the framework for organizing the pieces of that picture. With a financial plan in place, you'll be better able to focus on your goals and understand what it will take to reach them.

One of the main benefits of having a financial plan is that it can help you balance competing financial priorities. A financial plan will clearly show you how your financial goals are related--for example, how saving for your children's college education might impact your ability to save for retirement. Then you can use the information you've gleaned to decide how to prioritize your goals, implement specific strategies, and choose suitable products or services. Best of all, you'll know that your financial life is headed in the right direction.

The financial planning process

Creating and implementing a comprehensive financial plan generally involves working with financial professionals to:

  • Develop a clear picture of your current financial situation by reviewing your income
  • assets, and liabilities, and evaluating your insurance coverage, your investment
    portfolio, your tax exposure, and your estate plan
  • -Establish and prioritize financial goals and time frames for achieving these goals
  • -Implement strategies that address your current financial weaknesses and build on
    your financial strengths
  • -Choose specific products and services that are tailored to help meet your financial
    objectives*
  • -Monitor your plan, making adjustments as your goals, time frames, or
    circumstances change
  •  

Some members of the team

The financial planning process can involve a number of professionals.

  • Financial planners typically play a central role in the process, focusing on your overall financial plan, and often coordinating the activities of other professionals who have expertise in specific areas.
  • Accountants or tax attorneys provide advice on federal and state tax issues.
  • Estate planning attorneys help you plan your estate and give advice on transferring and managing your assets before and after your death.
  • Insurance professionals evaluate insurance needs and recommend appropriate products and strategies.
  • Investment advisors provide advice about investment options and asset allocation, and can help you plan a strategy to manage your investment portfolio.

The most important member of the team, however, is you. Your needs and objectives drive the team, and once you've carefully considered any recommendations, all decisions lie in your hands.

Why can't I do it myself?

You can, if you have enough time and knowledge, but developing a comprehensive financial plan may require expertise in several areas. A financial professional can give you objective information and help you weigh your alternatives, saving you time and ensuring that all angles of your financial picture are covered.

Staying on track

The financial planning process doesn't end once your initial plan has been created. Your plan should generally be reviewed at least once a year to make sure that it's up-to-date. It's also possible that you'll need to modify your plan due to changes in your personal circumstances or the economy. Here are some of the events that might trigger a review of your financial plan:

  • -Your goals or time horizons change
  • -You experience a life-changing event such as marriage, the birth of a child, health
    problems, or a job loss
  • -You have a specific or immediate financial planning need (e.g., drafting a will,
    managing a distribution from a retirement account, paying long-term care
    expenses)
  • -Your income or expenses substantially increase or decrease
  • -Your portfolio hasn't performed as expected
  • -You're affecd by changes to the economy or tax laws

Common questions about financial planning

What if I'm too busy?

Don't wait until you're in the midst of a financial crisis before beginning the planning process. The sooner you start, the more options you may have.

Is the financial planning process complicated?

Each financial plan is tailored to the needs of the individual, so how complicated the process will be depends on your individual circumstances. But no matter what type of help you need, a financial professional will work hard to make the process as easy as possible, and will gladly answer all of your questions.

What if my spouse and I disagree?

A financial professional is trained to listen to your concerns, identify any underlying issues, and help you find common ground.

Can I still control my own finances?

Financial planning professionals make recommendations, not decisions. You retain control over your finances. Recommendations will be based on your needs, values, goals, and time frames. You decide which recommendations to follow, then work with a financial professional to implement them.

IMPORTANT DISCLOSURES

Material contained in this article is provided for information purposes only and is not intended to be used in connection with the evaluation of any investments offered by David Lerner Associates, Inc. This material does not constitute an offer or recommendation to buy or sell securities and should not be considered in connection with the purchase or sale of securities.

To the extent that this material concerns tax matters, it is not intended or written to be used, and cannot be used, by a taxpayer for the purpose of avoiding penalties that may be imposed by law. Each taxpayer should seek independent advice from a tax professional based on his or her individual circumstances.

These materials are provided for general information and educational purposes based upon publicly available information from sources believed to be reliable-- we cannot assure the accuracy or completeness of these materials. The information in these materials may change at any time and without notice.

Some of this material has been provided by Broadridge Investor Communications Solutions, Inc.

David Lerner Associates does not provide tax or legal advice. The information presented here is not specific to any individual's personal circumstances.
Member FINRA & SIPC.

 

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About

Founded in 1976, David Lerner Associates is a privately-held broker/dealer with headquarters in Syosset, New York and branch offices in Westport, CT; Boca Raton, FL; Teaneck and Princeton, NJ; and White Plains, NY. For more information contact David Lerner Associates Call 516-921-4200 Visit our website: http://www.davidlerner.com

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Contact

Jake Mendlinger
Account Manager
Zimmerman/Edelson
516.829.8374 X 232
jmendlinger@zimmed.com

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