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By Gina Gallagher | Citizens Bank Contributor
The new year is a great time to review your financial relationships. It’s also an ideal time to work on one of your most important ones — the relationship you have with your financial advisor. Your financial advisor could play an important role in helping you achieve your short- and long-term goals. But are you on track to reach those goals? Citizens Bank Senior Vice President and Head of Wealth Management Jason Friday recommends meeting with your financial advisor and asking these five very important questions of yourself — and your advisor.
What do you value? Often when people come to their financial advisor, they are nearing retirement or looking for assistance with a specific issue. In working with his clients, Friday likes to take a step back and have a deeper discussion by asking a very important question: What do they value? “As we get older, our priorities change and we often discover that spending time with family and friends means more to us than accumulating material things. That’s why I advise my clients to determine what they financially require beyond providing for basic needs. Many people haven’t really thought about this question. In fact, when I meet with married couples, they often have differing opinions on what they want; one spouse may want to travel and the other doesn’t.”
Friday believes that determining what you value in your life is the first and most important step in financial planning — and one that should be undertaken with the guidance of a good financial advisor.
Is your current plan aligned with your goals and values? Once you’ve determined your financial goals and identified your values, you must determine if you have a plan that’s aligned with them. Having a plan that’s built on your values is like having a solid foundation on a home you build. Without that foundation, your home won’t stand the test of time, nor will it allow you build on it as your needs change.
Do you even have a plan? According to Friday, many people don’t even have an established plan. “Many financial advisors don’t do financial planning. They may create asset allocations based on your goals, risk tolerance, and timeframe, but they haven’t actually documented your goals and objectives. You need a financial plan that not only outlines your goals and objectives, but also has some math behind it connected to the investment decisions made.” Additionally, he believes that the plan should address other goals as well as unexpected life events. “Your plan may include life insurance and estate planning services to protect you from unforeseen circumstances.”
Is your advisor doing it right? If your advisor hasn’t created a plan, or if you don’t think your current plan is aligned with your goals, you may want to consider getting a second opinion. Meet with another advisor and ask what they would do differently.
How do you begin planning? If you’ve determined you need a plan, the most obvious question is: How do I get started? Friday recommends that you begin by thinking about your goals and getting organized by gathering your financial documents to determine what you have. You can try to accomplish that on your own or work with a financial advisor.
Once you determine what you have and want, you can assess what you’ll require to achieve your goals, including your time and money. You would then analyze the gap between what you need and have and build a financial plan that helps you bridge the gap. Your plan should factor in things that cannot be anticipated, such as job loss or death.
Friday believes that building your plan is not the final step. “Think of your plan as a living, breathing thing. Your life — and your goals — are constantly changing, and it’s important to continually monitor, review, and recalibrate your plan to ensure it remains aligned with your goals.”
By asking these questions of yourself and your financial advisor and developing a solid financial plan, you can get off to a great start for 2020 — and the future.
A Citizens Bank Wealth Management Advisor can help you build a long-term investment strategy with your goals in mind. Fill out this simple form to request a call back from an advisor so you can start planning for your goals.
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