Financial Assessment is the process of meeting your life goals through the proper management of your finances. Life goals can include buying a house, saving for your child’s higher education or planning for retirement. The Financial Assessment Process consists of six steps that help you take a ‘big picture’ look at where you are currently. Using these six steps, you can work out where you are now, what you may need in the future and what you must do to reach your goals. The process involves gathering relevant financial information, setting life goals, examining your current financial status and coming up with a strategy or plan for how you can meet your goals given your current situation and future plans.
Financial Assessment 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 pay off your mortgage faster or it might delay your retirement significantly. By viewing each financial decision as part of the whole, you can consider its short and long-term effects on your life goals. You can also adapt more easily to life changes and feel more secure that your goals are on track.
Financial assessment offers a coordinated and comprehensive approach to helping you achieve your personal and reasonable financial goals. Building, managing and preserving wealth is not an easy task. Maybe you have recently retired and are concerned about outliving your nest egg. Perhaps you are a baby boomer trying to plan for a secure retirement. Maybe you are part of the “sandwich generation”, caring for your own children at home while also caring for the needs of aging parents. Maybe you are recently widowed or divorced with all of the complications that these life challenges bring. Maybe you have accumulated substantial wealth and want to protect your assets from lawsuits, spendthrift relatives, divorce or other potential threats not only to yourself but also to your heirs. Further complicating the financial landscape is the vast array of advisors and publications that typically offer conflicting opinions and advice. Fortunately, CERTIFIED FINANCIAL PLANNER™ practitioners are available to assist you in the process of developing a sound financial plan. Selecting appropriate investments is simply one ingredient in the recipe for an effective financial plan that should also include retirement and estate planning. An experienced financial assessment team will help you to :
1. Identify your goals.
2. Understand your current situation.
3. Develop a plan that addresses your goals with your risk tolerance in mind.
4. Impliment and monitor the financial paln.
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