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How to Prepare for Your First Meeting with a Financial Planner

How to Prepare for Your First Meeting with a Financial Planner

You’ve taken the first step towards retirement security by setting up a consultation with a financial advisor. But what items should you bring to the meeting and how should you prepare to make the most out of the session?

Take the following steps:

  1. Get a detail accounting of your retirement accounts including any employee-based retirement benefits. Do you have a 401K or an IRA? What is the balance so far? Have you been contributing the maximum amount? Does your company match your contributions? If so, up to what amount? Speak with your human resources department to get both your personal account balance and your company’s retirement plan options.
  2. If you are a teacher, you are most likely enrolled in the Florida Retirement System (FRS). The FRS includes the Deferred Retirement Option Program (DROP) which provides four distinct retirement benefit plans. Or you can select the Second Election Option instead and opt out altogether from DROP, taking a lump sum upon retirement to invest however you want. With thousands of possible scenarios depending on your specific needs and circumstances, it is imperative to understand the choices available and discuss them with a DROP expert.
  3. Make a list of all your other assets and expenses. How much money do you have in savings and checking accounts? Do you own any property? Bring a list of all your assets including any of the following: mutual funds, CDs, annuities, life/disability/long-term care insurance policies, brokerage accounts, and bonds. List your debts too including: mortgage, student loans, credit cards and car loans. Remember to bring your latest tax returns also.
  4. If you have a will or trust, bring it. Be prepared to share information about your estate planning to date. When did you prepare your will or trust? Is it still current? Have your finances changed since then?
  5. Your income information. What is your monthly income and how much do you spend each month? Is your income steady or does it fluctuate? Do you have any large expenses coming up in the future? Are you saving up for a large purchase or dream vacation?
  6. Be prepared to discuss your long and short term financial goals. Do you plan to pay for your children’s college tuition? Are you supporting an aging parent? Are you healthy or suffering from a chronic condition that will require significant support as you get older? Consider financial issues that may arise later to help your advisor create a customized plan that will meet your future needs.
  7. Think about your risk tolerance. Based on factors such as your age and health, consider your level of comfort as an investor. Are you conservative in general with your money or are you a risk-taker? While a good advisor makes sure to diversify your portfolio to protect you, it is critical for him to know your risk-tolerance to make a plan to works for you.
  8. Determine which family members you would like to consider as beneficiaries. It is also wise to think about whom you might what to give a power of attorney to in case you become mentally incapacitated. And you may want to identify a trusted relative to share your financial wishes and plan with.

After reviewing your personal financial picture and goals, you advisor will create a cash flow analysis. This is a projection of your income and expenses, with inflation and investment rates taken into account. It will give you a clear picture of how much money you actually have to save, invest and grow after paying for current and projected expenses.

The advisor will also create a financial timeline. A monthly savings plan will help you know specifically how much to allocate to your retirement plan (401k, IRA, etc), as well as other investments (stocks, bonds, treasuries, etc) to reach your specific goals. He will also create a broader, long-term retirement roadmap to help you understand the progression of your portfolio based on your new monthly savings plan.

With fluctuating markets and inevitable life changes, your advisor will also recommend that you meet annually to review your financial plan. Your plan will need routine review to make sure your assets are balanced, that it continues to reflect your risk-tolerance, and that you are on track to meet your financial goals.

At Silverman Financial, we provide a complimentary consultation for new clients. We offer decades of retirement planning expertise to help you understand your finances and prepare for a stable and rewarding future.