Almost every day I read on internet and even I receive emails with exactly the same question:
Should I use a financial planner? Will that service help me?
Why would I pay thousands of $$$$ for this service?
So, to make it easy for everyone, I want to answer this question once and for all, and today I will be brutally honest with you.
You might think that I am biased being a financial planner myself, but I will try to look at this issue
rationally and objectively from the perspective of decision-making personality type.
My name is Katherine Isbrandt, I am CFP, and you are watching About Retirement TV,
the place to find all the financial information you need to make smart financial decisions
if you are preparing yourself for retirement or if you have already retired.
Whether you use or don’t use any professional service, goes back to your decision-making process
and generally there are 4 kinds of personality types when it comes to these decision-making abilities.
No 1. You are a Do It Yourself kind of the person, but not just in talk, you actually do the job required.
You learn, you study, you get your books, your courses, you spend time, you do your research,
you do comparisons of scenarios, calculations, learn tax structure in your country,
learn legal system in your country, you buy software to compare different types of investments,
different strategies, fee structures, benefits, drawbacks of different contracts.
If you really, honestly do all of that – you don’t need financial planner, you can do your planning just fine.
And you most likely will be very successful in it – or maybe you should start thinking about
becoming financial planner yourself.
As an example, my husband and I we self-renovated our home. It's almost finished but there is still one part left which is our kitchen,
but my husband who in his previous life was a high voltage electrician, he spent days and nights
researching, studying, speaking with professional engineers, we spoke with designers, we still needed services
of electrician, plumber, roof fixing company and many, many others.
It took us 10 years. 10 years of working full time, raising family and fixing the house. Believe me it is difficult.
I guess what I'm trying to say here is that if you are really, fully, 100% committed to the job,
you can do it, but as per my example, you cannot do it all just by yourself.
You still need assistance of professionals to support you to get the best result,
just like we did with our house.
No 2. You are a person that wants results, you want to improve your situation with what you've got,
or you want suggestions how to utilize your money how to use it smarter, how to create better cash flow,
how to improve your government benefits, how to improve your super or any other investments,
you want to create financial security for yourself and for your family, but
you yourself, you have no time, inclination or interest to do it by yourself.
If this is you most definitely you should use a services or financial planner
just like most likely you have an accountant, or a lawyer or a plumber or hairdresser.
This is service like any other just happens to be
in the area of finance that has impact on your whole life and the earlier you do it
the better off your financial life will be which in turn has impact on your emotional state
your family relationships on your ability to enjoy time with your family such as holidays
times of work. This is called choice and that gives you financial freedom and financial security.
A good example from my own life would be bookkeeping or accounting. You could say that as
a financial planner, I would know how to calculate my own tax, for myself and my business, but
why would I do it? I have no interest in it, I need a specialist to do it properly, fast and with no mistakes.
So I outsource to the best accountant I know, and the best bookkeeper I could find.
Of course, I have to pay for their work,
but I know I get great service, ongoing support, and importantly I can spend my time in the area
that is my passion and has been for over 20 years, which is financial and retirement planning.
And another big benefit is that is gives me time for my family, hiking, photography –
things that I love doing I would not be able to do if I didn’t ask for support around me.
No 3. You are a person that thinks you can do it yourself, you buy every course,
you spend lots of money on this education you have great intentions, you become a course junkie,
you start your study, but course after course you never finish any of them and then finally
after spending a little fortune - on all those half-done courses, you finally admit to yourself,
that either the topic of finance does not really interest you or you just don't have the time to do it.
And yes, then go and employ a financial planner as your coach.
And remember the company you bought all those courses from you they got paid,
they have your money regardless what you do with information, regardless if you get your results or not.
I can give you an example here as well
before coming to Australia I lived in Italy for two years and my Italian was pretty good
when I first arrived in Australia. But after living here for many years and not speaking Italian
I somehow lost ability to speak as fluently as I once was able to. But I love Italian.
So I decided to pick it up at some point about 10 years ago. I bought books and tapes and started to study.
At the beginning it was fun, I was excited, but then I also set up my financial planning practice About Retirement.
I started to get very very busy with work, clients and a new venture,
and a time went by and all those Italian books and tapes were just sitting on my shelf collecting dust.
I was unable to set the time for my Italian study, business has overtaken everything.
So, I made a decision to start private lessons with a lovely Italian lady. I set the time aside,
it was all pre-organised in my diary and I never missed the lesson. Having a coach helped me to get
organized, well prepared, we had our weekly lessons, so there was consistency
and slowly as months went by, I started seeing a lot of results, progress, and
my confidence in my Italian speaking returned again.
No 4, You are a person that listens to everyone around,
you talk with your neighbours, you talks with your friends,
everyone is happy to give you their advice and after all of this, you feel confused, overwhelmed,
you lose focus, and the only possible outcome out of it is lack of action,
inability to make decision, hence there is no progress, and you just stagnate and procrastinate.
So, please just stop! Stop talking to everyone around you. Of course, your friends mean well,
they want to help you, most people really want to help, but please remember that their advice
is based on their life, not yours, their circumstances not yours, their experiences not yours.
We are all different we want different things in life our personalities are different
and planning for your financial success is your own journey and your own set of steps.
What works for one person may not necessarily work for you. As an example what one person considers as
a good investment is not necessarily good for you for various reasons. What your neighbour might
consider for example a safe investment might be an investment that you might feel is of high risk.
So if you are that person of that type of personality speak with the
professional advisor otherwise you will be stuck for all your life.
So here we go, there are those are 4 options that exist. And I say if you want your results,
just honestly admit to yourself which type of a person you are and make decisions.
There is no right or wrong here.
And please leave a comment below my video and let me know
if you agree or disagree with me.
If you are truly do it yourself type, I applaud you
it is not easy, but can very rewarding, with consistency and clarity with support
of professionals in areas where you are not perfect, you can achieve all your goals.
But if you are not a 100% dedicated “do it yourself” type,
stop procrastination and make a decision to help yourself.
This is honestly what makes a difference being financially set and secure,
so you can actually have your life full of enjoyment and great experiences. Isn’t that what we all want?
I hope I managed to help you make it clearer whether you should or should not use services
of a financial planner or any other professional service for that matter.
For all the information about actual investing and retirement, please visit my website AboutRetirment.com.au
and while you are there, sign up to my newsletter to be kept up to date with all changes that might
affect your preparation for retirement or your existing retirement plans.
If you enjoyed this video, give it THUMBS UP and SUBSCRIBE not to miss my next controversial video.
And now let’s return to the basics of our retirement discussions. Watch a series of those videos –
all about smart choices to make when it comes
to your superannuation and savings for your retirement
The second lot of videos is for you,
if you have already retired and you would like to review
whether you can improve your retirement and Age Pension benefits
See you in my next video, bye.