What Do Financial Planners Actually Do?

"So what is your investment strategy?"

It's one of the first things that people ask when I meet with them. Ironically, many advisors will bring this up within the first 5 minutes of meeting with someone new. I would argue it is one of the last things that should be covered.

Investments are undoubtedly important, but they are supplementary to the financial planning process. The initial conversations should revolve around personal situations, and getting a grasp on how individuals are currently managing their financial life.

"Tell me about your family. Are you married? Do you have kids?"

"What do you do for work?"

"What would you like to accomplish with your money?"

Simple questions like these should be starting ground for good advisors to start understanding what issues clients may need help with.

For example, if someone is married with kids: Is there any life insurance in place to protect a surviving spouse? Are college savings accounts open to contribute to future education costs? Are accounts titled correctly with beneficiaries in place?

Alternatively, a young person with equity compensation and commission based income: Do you know what type of shares you were granted? Do you have a strategy around what to do large commission checks? Where is your discretionary income currently going?

By prioritizing these personal conversations over diving into investment strategies, advisors build a stronger foundation for financial planning. It's about establishing trust, understanding individual needs, and tailoring financial plans to personal circumstances.

True financial planning encompasses much more than simply investing someones money. Cash flow planning, charitable giving, tax planning, retirement income planning, education planning - the list is endless.

Clients should be discussing everything in their financial life with their advisor. The advisor/client partnership is about education, to help individuals make smart financial decisions with their hard-earned money.

If your advisor is only talking about investments, it's probably time to start looking for a new one.

Jared Gagne

Private Wealth Manager

617.378.3011 | [email protected]

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