The value of a financial planner

Lana Visser | 21 July 2023

Lana Visser, is a paraplanner at Fiscal Private Client Services. She has a B.Com in Quantitative Management and is currently studying towards obtaining a Postgraduate diploma in Financial Planning.

Financial planning is often referred to as the second most important profession after the medical field.

While everyone trusts their doctor and other health care professionals to look after their physical and mental health, why is it that so many people neglect to look after their financial health?

Consider the ways in which financial planners add value.

The holistic view

Financial planners are required to have knowledge across a broad range of fields from investment planning, retirement planning, tax and estate planning to budgeting or cash flow planning.

While it is important to have a tax practitioner to assist with your income tax returns and a legal professional to draft your will, a financial planner will develop a financial plan and structure your portfolio taking everything into account. Read more: What should a financial plan include?

This means designing a portfolio that suits your circumstances, is tax efficient and helps ensure your last wishes are carried out accurately and efficiently when you die. It also means that each time your circumstances change, the impact these changes will have on these various aspects will also be considered.

For example, financial planners know about investments that can provide cash to your family in the event of your death and can assist you in structuring your investments to ensure that your loved ones do not have to wait for your estate to be wound up.

Peace of mind

With the access that we now have to information and technology, it may seem like everyone can manage their own financial affairs. The question is: should you?  

Financial regulations are constantly changing. In addition to this, there are new products that become available and existing product rules that change from time to time.

Financial planners are required to keep up to date with these changes, meaning that you don’t have to. Your planner will inform you of any changes affecting your financial plan and will provide you with clear information of the impact it will have and the options available to you. Read more: The role of a financial adviser

Decision making assistance

We’re all human. There are many moments in life when emotions cloud our judgement, and we are at risk of making irrational decisions.

Just like your doctor assists you in making medical decisions in moments of crisis, a financial planner acts as a sounding board to make sound financial decisions in life’s big moments.

A financial planner provides the objectivity you need when making decisions, and provides the necessary information to help you anticipate the different outcomes of the available options.

It is a financial planner’s responsibility to educate you and provide you with the information required to make an informed decision.

For example, death and divorce are two life events which are both emotional, but can also have a big financial impact. Having a financial planner to assist you with decision making during such emotional times can have a positive financial impact on your circumstances.

Structuring and simplifying your finances

A financial planner will work with you to develop a financial plan which is suited to your circumstances and simplifies your affairs.

Your plans will guide you if you find yourself in a financial emergency.

It also makes it easier for your family to assist you should you be unable to do so yourself. A documented financial plan clarifies your goals and intentions and specifies how your financial resources should be utilised to achieve those goals.

A professional partnership

Having a financial planner doesn’t mean that you are not privy to your own financial affairs, but rather that you have peace of mind that a qualified professional is helping you take care of them.

The right financial planner will work with you on all your decisions and life transitions, guiding you through all the information provided.  Read more: How do I find a financial adviser who is right for me?

Just as you have your trusted GP, don’t you think it’s time you found a financial planner too?