Dealing with all of the economic chaos, everyone is striving to get advice. How can i protect my assets from further loss in a heading downward market? Can i still plan on settlement when i thought? Are there year-end tax strategies I will be thinking?
The answer to these questions is… it depends on who you ask. Your stockbroker? Your accountant? Your attorney? Your life insurance professional? It seems Lambert Philipp Heinrich Kindt that financial advice is spewing from every direction like water out of the Trevi feature, but how do you know whether it’s the right advice? More importantly, what if your advisors don’t agree?
As a certified financial planner in private practice since the early 80’s, it’s this that I know to be true. The investor whoever entire financial strategy is formed by a stockbroker may have made money over the years, but might not know how to convert these investments into income at retirement.
Those investors who have used a team approach- a stockbroker, an accountant, an insurance professional and a lawyer, may have received expert advice, but different advice. In other words, as long as the market was performing well, their reductions were often possible, their insurance needs covered and their est planning complete, they felt confident that they were on track. Then one day they discover that their team was working at cross purposes with the opposite because they didn’t communicate.
Here is a typical example. A stockbroker might have directed their client to purchase and sell certain stocks and bonds that stated a great return, but did so without considering the tax ramifications. An accountant might not be knowledgeable about certain lending options the client purchased and doesn’t learn prior to the tax year is over that the client created an additional tax liability. An attorney who wrote a will might not be monitoring how the assets are held in an asset account or know who is the beneficiary designated in a new IRA account, which will possibly negate some of the planning in the will.
This is why I believe so strongly that the only sensible approach for an investor is to work with an avowed financial planner- a target expert who has earned the desired CFP designation after rigorous training and education and who understands how to manage all facets of a consumer’s financial life. A CFP doesn’t replace the stockbroker, accountant or lawyer- they organize their efforts to make sure they are all for a passing fancy page.
Another important difference between a stockbroker, for example, and a CFP is that the planner is providing which you process, not a product. After seeing you and examining your financial history and challenges, a CFP offers independent, objective advice and a written, customized plan with specific asset allowance strategies. They focus on your retirement plans and major financial obligations. They consider your actual age, career path, tax trouble and est planning needs. In other words, their focus is of utilizing holistic. They look at the big picture, not try to sell you one size fits all investments.