Six Steps Of Financial Planning

Southwood Financial Planning is committed to helping you achieve your financial and lifestyle goals through a comprehensive financial planning process. We believe that by understanding your needs, ambitions, aspirations and fears we are able to provide a unique and personalised solution. Our financial advisors follow a process that incorporates the necessary steps as detailed by the FPI (the local professional body – Financial Planning Institute). The process is comprehensive, ongoing and encompasses all aspects of financial planning including investment planning, retirement planning and estate planning and structuring. It details the strategy for getting to where you ultimately want to be.

Step 1 – Establishing and defining the professional relationship (the first appointment)
Step 2 – Gathering information
Step 3 – Analysing and evaluating your financial status
Step 4 – The Plan
Step 5 – Implementation
Step 6 – Monitoring the financial planning recommendations

Step 1 – Establishing and defining the professional relationship (The first appointment)

The first meeting with us is always without charge or obligation as it is important to confirm that the client / planner relationship is appropriate for both parties. Our financial advisors start by creating a personal profile for you, looking at your individual circumstances and current financial situation.

We want to understand your unique needs and have a clear picture of where you are and where you want to be. We will look at your family, work or business, tax position and investments to get the detail we need.

This first meeting is also about establishing a good working relationship and partnership between you and your financial planner / advisor. We will:

  • explain the process to be followed
  • identify your needs and level of advice required
  • be clear about what your and our responsibilities are and how decisions will be made
  • give you clear service package options
  • discuss payment for services
  • map out the process and get your consent to proceed
  • confirm how long the professional relationship is expected to last

Download Corporate Profile
Download the Service Level Agreement
Download FICA requirements
Download Letter of Authority (Standard)
Download Client Budget

Step 2 – Gathering information

We will ask you to provide Southwood Financial Planning with information detailing your current financial situation, commitments and short to long-term financial goals. Our financial advisors will then confirm and define your personal and financial goals with you, and set a time frame for results. We will look at your objectives, concerns and aspirations and discuss your attitude to investment and other risks. In planning your financial future, we believe that all of these factors are critical to understanding your personal approach to financial planning and risk taking.

Download the Needs Analysis Questionnaire

Step 3 – Analysing and evaluating your financial status

This step involves analysing your financial information together with your planner to understand your current position and future goals. Depending on what services you require, your planner will advise you on what financial strategy to adopt to achieve your personal and financial goals. This might incorporate analysis of the following:

  • your balance sheet (assets, liabilities and cash flow)
  • current risk (assurance) portfolio
  • reviewing discretionary and compulsory retirement investments
  • reviewing last will and testament and estate planning structures in place

Step 4 – The plan

Your planner will then draw up a Personal Financial Plan. This details the recommendations and strategies for achieving your goals and objectives. It will look at your existing financial arrangements and lay out a plan for the future, and will cover your assets, investments, liabilities and income. It will also, importantly, look at contingency planning and help you plan for any disasters which may arise. Your financial plan can also include a will and other estate planning structures, along with any other specific personal needs that you may have. Our financial advisors will discuss and review these recommendations with you to ensure they are understood, along with any concerns that you, as the client, may have.

Your Personal Financial Plan will enable a review of all aspects of your financial portfolio:

• your balance sheet (lifestyle and investment assets and liabilities)
• your risk (assurance) portfolio

Step 5 – Implementation

This stage details the implementation process (action plan) and calls for agreement from you, the client. Your planner / advisor will record any agreed implementation plan and attach all the necessary documentation in support of the plan.
Other professional expertise will be brought in if required.

Step 6 – Monitoring the financial planning recommendations

The final stage is about regularly reviewing the plan to make sure everything works for you. Your planner will look at any change in circumstances and, if necessary, change the plan to incorporate them. Reviews are usually done annually but can be done more often if needed. This review is also a chance for you to ask any specific questions that may have come up or to discuss any concerns you may have. This proactive review is about making sure your plan really works for you, every step of the way.

Given the personal nature of a client’s financial affairs, we feel that personal interaction is extremely necessary in order to allow this process to work efficiently. Read our FAQs, or if you prefer to talk to one of our financial advisors, please contact us directly.