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Financial Planning FAQ

What is Financial Planning?



Financial planning is the process of meeting your life goals through the proper management of your finances. Financial planning helps you make advance provision for financial needs that will arise in the future. The objective of financial planning is to ensure that the right amount of money is available in the right hands at the right point in the future to achieve an individuals life goals.


Why should I make a Financial Plan?



Financial planning provides direction and meaning to your financial decisions. It allows you to understand how each financial decision you make affects other areas of your finances. For example, buying a particular investment product might help you save adequately to finance your childs higher education or it may provide enough for a comfortable retirement. You can also adapt more easily to life changes and feel more secure that your goals are on track.


Who is a Financial Planner?



A financial planner is someone who uses the financial planning process to help you determine how to meet your life goals. The key function of a financial planner is to help people identify their financial planning needs, their present priorities and the products that are most suitable to meet their needs. He or she normally possesses detailed knowledge of a wide range of financial planning tools and products, but his major role is to help clients choose the best products for each need. The planner can take a big picture view of your financial situation and make financial planning recommendations that are right for you.


Can I do my own Financial Planning?



Some personal finance software packages, magazines or self-help books can help you do your own financial planning. However, you may decide to seek help from a professional financial planner if:


     You need expertise you dont possess in certain areas. For example, a planner can help you evaluate the level of risk in your investment portfolio and revise your asset allocation


    You dont have the time to spare to do your own financial planning.


     You know that you need to improve your current financial situation but dont know where to start.


      You feel that a professional advisor could help you improve on how you are currently managing your finances.


      You have an immediate need or unexpected life event such as an inheritance or major illness.


      You want to get a professional opinion about the financial plan you developed for yourself.


What should I look for in a Financial Planner?



A financial planner works for you. His or her loyalty should be to the client, not the product (s)he is trying to sell. The financial planner should be in a position to provide you with unbiased advice and recommend products that match your needs and are the best performing ones available. Look for any affiliations of the financial planner to any product manufacturer. Until unless the financial planner is truly independent, (s)he will not be able to give you objective advice.


How can I plan for tomorrow when I can hardly pay for today?



Have a budget. Determine what you actually spend each month. There are fixed expenses like rent, loan repayments, etc. every month about which we can do little. The variable items such as food, clothing and entertainment are often what get away from us. Use your discretion to contain these variable expenses to start saving.


How much should I be saving?



It is hard to apply a rule of thumb toward savings, because it varies with age and income level. Ten percent is a good start. If you find that is too high for you, dont let that deter you. You can start by putting a little aside each month and then slowly increasing it.


What if I dont achieve my goals?



Financial planning is a common sense approach to managing your finances to reach your life goals. It cannot change your situation overnight; it is a lifelong process. Remember that events beyond your control such as inflation or changes in the stock market or interest rates will affect your financial planning results.


Why do I have to provide so much personal information?



Consider a visit to your doctor. Without complete and fully accurate details, your doctor cannot prescribe the best course of action. The same applies to financial planning. In order to obtain the best service for your financial health all details and specifics must be disclosed.


What type of information do I have to provide?



Typically, information regarding investments held, number of dependants, income and expenditure details, savings and financial planning needs, etc. The more accurate information you give, the better the quality of advice given.


What should a Financial Plan include?



A financial plan should include a review of your net worth, goals and objectives, investment portfolio, cash flow, investments, retirement planning, tax planning and insurance needs, as well as a plan for implementing your goals.


Why is there an evaluation of my insurance needs?



Evaluating your insurance needs is part of personal financial planning. Insurance takes care of your unpredictable needs and as these needs can arise at anytime, insurance is extremely important. Investments take care of your predictable needs and ideally should follow after your unpredictable needs are first addressed. The insurance industry has changed a great deal over the past few years and there is a whole array of new products from LIC as well as private insurance companies.


What about taxes?



It is important that financial plans are tax efficient. The financial plan should help you in minimizing your tax liability and also maximizing your after-tax returns from your investments. Some financial planners help their clients in preparing and filing their tax returns.


After a plan is developed, what next?



The best plan is useless unless it is put into action. Your financial planner will assist you completely in implementing the plan, if and when, desired by you.


How often should I update the plan?



It is good to review the plan when there is a lifestyle change such as marriage, birth, death or divorce. Any change in financial position should be evaluated as well. Most people have an annual update that reviews how the plan is being implemented. The review also considers changing goals and circumstances.


Please tell me about the financial planning process

Financial planning is a multi-step process that provides you with two important things: (1) An in-depth review of your current financial situation, and (2) a blueprint that shows you how to achieve your goals and objectives for the future. At MLG Financial Planning, the financial planning process consists of seven distinct steps (see our Building a Brighter Financial Future flow chart for details on our unique financial planning process). It is important to remember that financial planning is a process . . . not an event.

How do you create this blueprint

First we focus on your goals, objectives, priorities and values. For instance: the reduction of current and future income taxes may be an immediate goal, funding a quality education for your children and/or grandchildren may be an intermediate goal, and enjoying a secure financial future in your retirement years is likely to be one of your most important long-term goals. Another great goal in life for some people is creating wealth and/or leaving a legacy for your chosen beneficiaries or charities. You may already be on the road to meeting these objectives and simply need a new strategy, professional insight, or to fine-tune your plan. You may just be starting out, or you may be somewhere in between. Whatever your unique situation may be, everyone needs a periodic assessment of where they are on the road to meeting their financial goals. Thats why we do an in-depth review of your current financial situation. Next, you need to know how you can set about achieving (or continue working toward) your financial goals. By focusing on cash flow, investments, taxes, pensions and retirement plans, estate planning, insurance issues, savings opportunities and other general financial matters, we design a customized financial plan for you. Finally, to achieve the intended results, you must implement and monitor your plan.

Sounds like a lot of work!

It may seem like that at first, but the good news is, if you follow your plan and maintain a disciplined approach, you can rest well knowing you can reach your stated goals. At MLG Financial Planning, we try to make the process as easy as possible for you. In addition to receiving professional advice on your most important financial concerns, we also provide implementation advice.

Who can benefit most from your services?

Any individual seeking financial peace of mind can benefit from our services. We serve people at all income levels, from all walks of life. Clients have the flexibility to work with us on either a one-time, as-needed basis or an ongoing basis. We welcome clients who simply need a one-time financial consultation or a second opinion, as well as those who need comprehensive financial planning and possible ongoing asset management services.

What is "Fee-Only" financial planning and why should that be important to me?

Because we are Fee-Only financial planners, all conflicts of interest regarding compensation are removed. We do not accept sales commissions; we work solely for our clients. Because we do not sell financial products such as investments and insurance, there are no third-party relationships or outside influences to color our thinking and financial recommendations. For more information on Fee-Only financial planning, including our Code of Ethics, Fiduciary Code and certificant requirements.

I understand the benefits of working with a Fee-Only financial planner, but I might need to obtain financial products. How will I be able to do that?

While we do not sell financial products, we will offer specific recommendations and opinions regarding the purchase of the various financial products that may be appropriate for you. So, if you need to obtain an insurance policy or a new mortgage, invest into a portfolio of mutual funds, or find an estate planning attorney or tax professional, we can direct you to the resources you need and/or help you obtain these products and services. If appropriate, we can also help you implement your plan and set up your accounts.

Does You provide only comprehensive financial planning?


No. Although a comprehensive financial plan can provide the greatest benefits, we can limit our advisory services to your specific needs, such as cash management and budgeting, investment analysis,401(k) review or college education funding.

My spouse and I are just beginning to build for our financial future. There is so much to learn! We need help and guidance to get started. Will you accept us as clients?

Yes. Some firms have income levels and/or net worth minimums but, at MLG Financial Planning, we realize that everyone has financial needs. We are proud to work with people from all income levels, and all walks of life. Remember, "You dont have to have a fortune to start building one." Call today and lets get started.

I have already accumulated substantial assets and think I am doing quite well. But as I progress and build for the future, things seem to be getting more complicated. I want to be sure I am on track, but I dont always have the time or inclination to manage the myriad details by myself. Can you help me?

Yes. People who need more sophisticated financial planning or advice will find our services appealing and beneficial. If you have a desire to simplify your financial affairs, our Hourly Continuing Client Program may be right for you (see Building a Brighter Financial Future diagram.) If you are looking for a professional review or a second opinion to ensure you are on track, we can provide that, too.

What types of securities do you provide advice for?

We provide advice for all types of securities, including mutual funds, stocks (as they relate to your portfolio holdings), bonds, bank deposits, variable and fixed annuities, limited partnerships and tax shelters. We also provide advice on mortgages, budgeting and cash flow issues, and retirement programs, stock options, life and disability insurance, etc. If it has to do with money and finances, we can provide counseling, guidance and/or resources for you. Because we want our clients to know that they can call on us with any and all of their financial concerns, we have developed the slogan "Financial Planning and Advice for Everyday Life." Clients are encouraged to call us when they have a major life event, such as a new job, a baby, a marriage or divorce, or if they are planning to buy a new home or start their own business. We also encourage our clients to call us with more common everyday questions, such as: "How should I invest within my Budget" "What advice can you offer on refinancing my home?" "How can I save for my childs college costs?"

If I use Your Financial Planning,  to develop a financial plan, am I obligated to purchase the recommended products?

Absolutely not. We will offer recommendations that in our professional opinion will meet your needs and objectives, but you are under no obligation to purchase them. In todays competitive market, it makes sense to shop around for the best available product or service. For instance, if you need to obtain a life insurance or disability policy, we will suggest the kind of policy, which riders and what amounts may be best for you. We will then direct you to a choice of companies that can provide a quality product at competitive prices for you. If you wish, we can help you purchase investments and/or set up your accounts with a third-party custodian such as a discount broker.

Tell me about your investment philosophy.

As financial planners and investment consultants, we believe in the following fundamental principals with regard to designing an investment portfolio and making specific recommendations: The purpose of a clients investment portfolio is to fund current and/or future financial objectives. The design of the portfolio must take into account the clients financial objectives, tolerance for risk, needs for current income or liquidity, and special considerations such as income and estate taxes. The important thing to remember is that no one can predict the future. It is difference of opinion that makes a market. Investment and economic "experts" provided with the same information often come to different conclusions. We do not suggest that we can, or that any of the money or mutual fund managers that we recommend, will make the correct decision every time. We do believe, however, that studying the historic trends and relationships of investment classes and the philosophies and approaches of successful investment managers can provide valuable insight. The appropriate allocation of investment assets for your goals and risk tolerance is the most important component in developing an investment portfolio. We believe that having a diversified, well-balanced portfolio, following long-term buy-and-hold strategies, and having patience, will increase the likelihood that one will achieve their long-term financial objectives.

How do you select investments for a client?

Before we recommend any investment, we consider the current economic conditions, the outlook for that asset class or type of security and how this investment fits within your portfolio given your objectives and tolerance for risk. For equity investments, we focus primarily on the philosophies, experience and track record of the management team. With fixed income investments, we look for the best yield available for a given quality of security. As fiduciaries for our clients, we strive to obtain the most appropriate investment vehicles to meet your objectives, while being very conscience of total expenses and risk exposure.

How do you price your financial planning services?

The fees are based on the actual time involved in meeting with you in person or over the phone, researching and analyzing your current situation, and providing specific recommendations and implementation assistance (if appropriate).

How much will my financial plan cost?

Financial planning fees are determined on a project basis; the total fee for a financial plan will vary from client to client based on the specific needs and complexity of the situation (please see our diagram Building a Brighter Financial Future to learn about our financial planning process and the client service options available). An estimate is provided after the Get Acquainted Meeting, when your personal needs are fully identified. Once your financial plan is complete, there are two basic levels of client/advisor relationships (for more information, see Building a Brighter Financial Future diagram).

Once my financial plan is completed, will our relationship end?

Depending on your client track, the actual engagement of services may end (please refer to Seven Steps to Building a Brighter Financial Future), but the majority of our clients choose the Continuing Client Program. Because financial planning is a process, not an event, we offer ongoing services, periodic reviews and day-to-day consultation as requested and/or needed.

How can I get started?

The first step is an initial inquiry from you. We offer an initial no-cost, no-obligation Get Acquainted Meeting, either on the phone or in our office. For Get Acquainted Meetings, appointments are scheduled based on availability during regular business hours of 9-5, Monday through Friday. Expanded office hours are available to accommodate special needs or emergency situations. Should you decide to engage our services, we can discuss which of our services and client tracks is appropriate for you. Most clients find the financial planning process to be stimulating and enlightening. The end result, of course, is greater peace of mind. We look forward to helping YOU build a brighter financial future!



Many investors are initially uneasy about working with a financial advisor, mainly due to lack of information about them. The more you know about professionals in this field, the more you will see that financial advisors are an excellent resource for professional help and advice in a wide variety of situations. Here are a few answers to frequently answered questions about financial advisors.

What is a financial advisor? 
A financial advisor is a licensed professional who helps both individuals and businesses who may be experiencing various financial difficulties or challenges. An advisor can help you in a wide variety of situations

What does a financial advisor do? 
A financial advisor is a trained specialist who helps clients with investments and various other financial matters. From retirement planning to brokerage advice to tax planning, financial advisors can help clients in every phase of their financial lives.

Why should I spend money on a financial advisor? 
Most commonly, individuals seek the help of a financial advisor for investment planning. But they can do much more than that. You can get help with Return on investments, work on personal finances and even get out of debt with the help of a financial advisor.

How can I choose the right financial advisor? 
This is an important choice that should not be taken lightly. Make sure you choose someone you trust and that you wouldnt mind working with over an extended time period. Make sure their area of specialization matches your interests and needs. The world of finance is so broad that many advisors develop specialties as they progress through their careers.

Whats the difference between fee only and commission based advisors? 
Fee only financial advisors work for an agreed upon fee thats set prior to the commencement of their work. It could be a flat rate, an hourly rate or a percentage of assets under management (AUM) in some cases. The amount charged is paid directly from the client to the advisor. Commission based advisors, on the other hand, are compensated on a profit sharing ratio (PSR).

Why is a financial advisor important to my overall financial plan? 
Most investors are not aware of many opportunities that are out there. A financial advisors job as it pertains to investment is to undertake a thorough assessment of the whole financial picture presented by the client, so that the advisor can come up with an ambitious but reachable goal for that client. A financial advisor is an unbiased and objective observer of the clients patterns of income and expenditures as well, which can be helpful.

How much money do I need to have available in order to invest with a financial advisor? 
It depends on the individual advisor. For some, they are happy with any client and will gladly work with you even on small investments. Others focus solely on clients with larger amounts of money to invest, and set minimum standards as such.

Does a financial advisor have to accept me as a client? 
In a sense, yes. You will need to provide at least some general information about yourself like your income, net worth, family status and your general financial goals. An advisor could choose not to represent you. It should be a good fit both ways if you are to truly benefit as a client.


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