By Sue Stewart, CFPCM MFAS Adviser and Director

MFAS celebrated World Financial Planning Day last week, so I thought it an opportune time to reinforce that Financial Planning can provide peace of mind to everyone, no matter what level of income, existing assets, or stage in life.

Financial planning is when you look at where you are today, what you want to achieve over the next number of years and your risk tolerance, and then establish a Plan to deliver on your objectives.  With a comprehensive overview of your current financial situation and a strategy to achieve your short, medium and long term goals, you are able to confidently make financial decisions, including helping family and philanthropy.   

The tools available to achieve your goals are likely to include KiwiSaver/superannuation schemes/ overseas pensions, mortgage and debt repayment, flexible savings/investments, insurance planning, retirement planning, retirement spending.  You probably have many of these building blocks already in place.

Through the financial planning process, you will develop a Financial Plan, which is a “living document” that is updated as your circumstances change, as we all know life is not linear! 

Your Financial Plan will illustrate how all these tools combine, what your current trajectory is, and how different decisions you make will affect your objectives. They say, “knowledge is power”, and this is certainly true when it comes to financial planning, as the information provided gives you clarity and confidence to back your financial decisions. 

Even if you have a long way to go to achieve your goals, knowing you are on-track is invaluable to your financial wellbeing.  At the other end of the timeline, if you have accumulated more funds than you will require, a Plan provides confidence for you to spend; be this a treat for yourself, helping your children and grandchildren get ahead, or with chosen philanthropic projects.  

Financial planning is not about getting rich quick, but rather making the most of your personal situation, gaining knowledge and confidence, and structuring your finances in a way that allows you to sleep at night.  It is not a transactional relationship – your financial planner is there for the long-term, through the good and the bad times. 

Two recent reports have clearly shown the value and benefits derived by working with a qualified financial adviser.  For the last 10 years Russell Investments has produced an annual report “Value of an Adviser” (contact us if you would like a copy). They use the formula:

Perhaps even more importantly, research released last week from the Financial Planning Standards Board showed that better financial well-being positively impacts other areas of life as it removes some of the most common stresses of daily life.  With your finances under control, you have better mental health, better physical health, a greater sense of purpose, emotional resilience, financial security and resilience, alignment with your values, (and the one I love the most), the ability to solve life’s challenges.

Who doesn’t want all the above!

So, talk to a financial planner and see what they have to offer. A first consultation is usually at no cost. Of course, we are always happy to have that first chat, and all the discussions that follow over the years!