What is financial planning and why is it important?

Lorcan Russell, CFP and Head of Financial Planning at Premier Insurances shares his thoughts on the importance of financial planning and how to start your journey.

What is financial planning?

In simple terms, financial planning is an ongoing process to help you make choices for your money that will allow you to achieve your goals. Some people think putting a financial plan in place is a once off event. However, like any plan it needs to be reviewed on an ongoing basis to ensure it is delivering.

How does financial planning work?

We look closely at your financial situation with you, determining what plans need to be put in place to help you reach your goals. We then review the progress of your plan at different intervals to ensure it stays on track. This allows any change of circumstances to be addressed.

Who creates the plan?

You do! But with our help. At Premier Insurances, you will be guided through your planning journey by a Certified Financial Planning professional (CFP®) and a team of  experienced financial planners. They will work with you to develop a financial plan tailored to your goals.

Why do I need goals?

It’s particularly important at the outset to determine exactly what the goal(s) of your plan are. This is just putting together a list of what you want your money to achieve for you. Is it to fund your children’s education? Pay off your mortgage early? Protect your family and lifestyle? Have the option of early retirement?

Can I have more than one goal?

Yes, absolutely a financial plan would usually have a couple of different goals. You just nee to prioritise them. That’s where our expertise can help in assessing the costs, the risks, and the timeline.

Should everyone have a financial plan?

Yes, I passionately believe that financially planning is for everyone. It’s just about getting organised. That way you have a plan for life’s hurdles as well as life’s highlights. Having a plan in place means you are in control of your finances, rather than them controlling you and how you live your life.

What does a financial plan look like?

It’s a comprehensive analysis of your current and future financial position. It allows us to predict future cash flows, asset values and how to make the best use of your finances in achieving your goals. I often compare a financial plan to a map. It’s a map of your financial journey. You wouldn’t reach a travel destination without a map guiding your progress. You’ll have breaks along the way to check the map and make sure you’re still going in the right direction. Likewise with a  realistic plan, you’ll know where you are going, and regular reviews help to ensure you reach that place.

What does the financial planning process involve?

There are six distinct steps to every plan but the length of time on each depends on the individual. With our structured financial planning process, we will help you to define, plan and reach your financial goals by guiding and tracking your progress with you, making changes where necessary to keep you on target until you achieve your goals.

Are all financial plans different?

Yes, they are, as there are many elements to your financial plans. Your dreams and aspirations are the goals we aim for overall but to achieve these you will need other key elements to be in place. These will help guide your journey towards the main goals and include things like how to use the right investment strategies to reach your goals, showing you how to invest for the long term in the most tax efficient way, showing you how to measure and manage risk properly.

How do I start a financial plan?

At Premier Insurances we will help you define the elements needed in your financial plan and help guide you along the path to achieving them. So, no matter what your financial goals, whether you want an investment plan to retire early and live a life of financial freedom, or an estate plan to pass on to your family and a legacy to leave behind you we’re here to help craft your plan with you.

Just get in touch to start your journey today.