The architect, builder and repair man of your financial house

Building your financial future is like building a house. A financial adviser can be your partner in that project, filling a number of important roles. Here are some of the ways that a financial adviser can help you build the right home for money in your life.

The architect

When you build a house, you need a plan. The plan should be customised to your individual needs and preferences and take into account all important aspects - mitigating risks you and your family may face and helping you to reach your goals by quantifying them and breaking them up into smaller achievable steps.

• Retirement Planning

An adviser can help you quantify your individual retirement goals and break them up into manageable monthly contributions. As your vision for your future shifts and changes, so will your retirement planning and an adviser can help you adjust your plan.

• Investment Planning

You will need to use investment structures to help you achieve your future goals. The design of your portfolios will need to be matched to your investment time horizon and fees will need to be kept to a minimum.

• Risk Planning

You and your family are exposed to financial risk arising from losing you as a breadwinner through your death, disability or long-term illness. Through risk planning, an adviser quantifies these risks and proposes ways to reduce them using insurance policies. Affordability and customisation of the cover to meet your individual needs is vital.

Medical scheme membership and short-term insurance should also be considered here to mitigate the risks of ill-health and loss of property.

• Tax Planning

Your adviser can also help you to reduce the amount of income tax you must pay now and in future. This planning is tied to your investment planning and the investment structures you use.

• Estate Planning

When you pass away one day there may be estate taxes your estate may have to pay. An adviser can help you to reduce these taxes by structuring your estate. This is also related to your investment planning as you should use investments that have minimal estate duty implications wherever possible.

Your last will and testament is also incredibly important. This defines who will inherit from you in the event of your death.

A will is also essential to nominate the guardian of your minor children in the event of your and their other parent’s death.

A will can create a trust structure that will house your assets for your minor children in the event of your death. You will nominate trustees to manage the assets in the trust for the benefit of your children until they reach a specified age, whereafter the trust can be dissolved and the remaining assets will be transferred to them.

Finally, you can also nominate who the executor of your estate will be. An experienced professional executor will save your family a great deal of stress and time, at a reasonable cost.

As your life changes, your estate plan will need to be adapted and changed too.

The builder

A plan that isn’t actioned is just a dream. The implementation of the plan is key and your financial planner can help you with this to ensure your financial house is built.

A builder needs the appropriate tools and materials. In the case of your financial house, these are the financial products that your financial adviser will identify as those that best serve your individual needs.

Once you have approved the plan, your financial adviser will get to work implementing it. Like a good builder, your adviser should make the implementation process as effective and efficient as possible using only the highest quality, most affordable products.

The repair man

Once your builder has built your financial house in line with your plan, the house needs to be maintained, repaired and improved periodically over time. A financial adviser also serves in this role of being your repair man available whenever you are faced with an important financial decision.

A good adviser will assist you with any ongoing financial administration you may need. Most importantly, your adviser will maintain your financial affairs by reviewing your financial house at least once, preferably twice, a year.

This will ensure that you are up to date with the performance of your investment portfolio, as well as other financial products in your portfolio, that all financial aspects are regularly considered and that updates and changes are made where needed.

An evolving role

Over the years financial advisers’ roles have evolved from a tool/hardware salesman to an architect, builder and repair man. An adviser’s job is now much more about service and much less about products.

Working closely with your financial adviser means you can build the financial future of your dreams.