MDRT financial planning guide

What is the difference between a financial planner and a financial advisor? What are the most common client goals and obstacles when working with a financial planner? How should risk management be addressed with clients?

MDRT members Bhupinder Anand, ACII, Dip PFS; Sylvia Brim, CPA, CFP; Adrian George, CFP, TEP; Roy Hall; Thomas Henske, CFP, ChFC; Max Horne, CFP; and Barbara Pietrangelo, CFP, ChFC, together possessing more than 130 years of combined experience as financial planners, advise on everything you need to know about financial planning.

A sample of what you’ll see addressed thoroughly in this guide:

The difference between financial advice and financial planning: Financial advice is reactive, product-specific, transactional, topic-specific and usually general; financial planning is long-term, comprehensive, education-based, multifaceted regarding different aspects of financial life, proactive, strategic, goals-driven and starts with the end in mind.

The key components of a financial plan, though varying by firm and country, generally include:

● Defining the relationship and expectations between client and planner
● Identifying objectives and gathering data
● Recognizing problems, opportunities, present plans and future recommendations
● Implementing the plan, then monitoring and updating

Cash-flow modeling is essential to align client needs and priorities with the advisor’s understanding of how to move forward with a plan. Through these conversations, advisors can address concerns, hypotheticals and any other client questions about their past, present and future.