The Financial Planning Process

Your first meeting sets the foundation for the relationship. During this conversation, you’ll typically:

• Discuss what you want to accomplish
• Learn about the financial planning process
• Review the services the CFP® professional offers
• Get details on how you will pay for products and services
• Learn how the planner is compensated
• Receive disclosures about conflicts of interest
• Review the CFP® professional’s background and experience

This step helps ensure transparency and establishes clear expectations before planning begins.

Once you agree on the scope of the engagement, financial planning officially begins. Your CFP® professional works with you to gather detailed information about your personal and financial circumstances, including:

• Income, expenses and cash flow
• Assets and liabilities
• Risk tolerance
• Insurance coverage and potential risks
• Personal and family circumstances
• Needs and priorities

This holistic review allows your planner to understand both your financial details and the context behind them.

With a full picture of your situation, you and your CFP® professional work together to define your goals. These may include:

• Accumulating adequate retirement assets
• Saving for education
• Ensuring that you have adequate insurance coverage
• Managing debt
• Planning for future generations

Clear goals help guide every recommendation that follows and ensure you and your planner are aligned.

Next, your CFP® professional evaluates your current course of action and potential alternatives. This analysis may include:

• Cash flow sustainability
• Adequacy of emergency savings
• Asset protection
• Aligning investments with your values
• Retirement readiness

Through this analysis, your CFP® professional will help you identify strengths, uncover vulnerabilities, discover opportunities and understand where adjustments may improve your ability to reach your goals.

Based on the analysis, your CFP® professional develops recommendations tailored to you. These recommendations are built using reasonable assumptions related to:

• Life expectancy
• Tax considerations
• Investment returns
• Risk management

The focus is on creating strategies designed to maximize the potential of achieving your goals — financially and personally.

Your CFP® professional presents the recommendations and walks you through:

• Why each recommendation was made
• What assumptions were used
• What actions may be required and when

You’ll have the opportunity to ask questions, provide feedback and adjust the plan before moving forward.

If implementation is part of your engagement, you and your CFP® professional will clarify what your financial planner will be doing and what you will be handling. Your financial planner may, for example, be responsible for:

• Selecting financial products or strategies
• Providing referrals to other professionals, such as an estate planning attorney
• Reallocating investments to the targeted asset allocation

You’ll have the opportunity to talk to your CFP® professional about the recommendations before you make your selections.

Financial planning is not a one time event. If monitoring is included, your CFP® professional works with you to:

• Track progress toward your goals
• Review performance
• Adjust the plan as your life changes

You’ll share updates about changes in your circumstances (such as a new job or the birth of a child), while your planner helps determine when updates to your financial plan are needed. This ongoing partnership provides guidance and support over time so that you can take the guesswork out of reaching your financial goals.