personal finance planning

Before you decide on personal finance planning, it’s important for you to define what that term means to you. For many people it simply means that they want to come up with a realistic budget so that they can get their finances under control. If that describes you than you can either make up your own budget, find someone to help you do it, or purchase budgeting software to walk you through the steps. If, on the other hand, you’re thinking more about ways of investing so that you can save for college and/ or retirement, you might be better off finding a highly trained professional who can walk you through the process and point out all the pros and cons of each option.

If you’re going this route, it’s very important that you take time to pick the right financial planner. Just like any other profession, some planners will be more qualified, and honest, than others. You have to make sure that the person you are relying on to help you steer a course to financial freedom really has the skills to help you.

Here are some steps you should follow to find the best fit for you and your goals:

1. The first thing is for you to take time to figure out what your goals are. Just saying you want to retire in ten years won’t be enough, you need to let the planner know what you want to do when you’re retired so they can help you figure out how much money you’ll need. Figure out all you want to accomplish and be specific, before you meet with a planner.

2. Once you know what financial goals you want a little extra help with, it’s time to find a good planner. The best place to start is by asking friends and family if they know of anyone. Try to only take the advice of people who have actually used the services of a certain planner and not just your Aunt Sue who has a friend who has a cousin who is a financial planner. Stick only with those people who have actually worked with the person giving the referral.

3. Find out what credentials your planner has. Make sure that their personality is compatible with yours. For example, if you are more laid back and risk averse in your financial affairs, you don’t want a planner who has a flat out go for broke type of personality.

4. Find out how they get paid. Many planners get paid a commission whenever one of their clients (you) buys or sells a stock. If that’s the case than can the planner be unbiased in their advice? If they only make money when you buy how can you be sure that they won’t encourage you into investments that might not be a good fit for you just so they can earn a commission?

Personal finance planning can be as simple as setting up a household budget or as complex as planning for college and retirement. No matter which option you’re interested in, it pays to spend some time educating yourself and never be afraid to ask questions, it’s your money after all.

Category: Personal Budget
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