Picture yourself going to a doctor, paying upwards from R500 for the consultation, and he merely looked at you, and gave you a prescription for chronic medication, upwards of R1 000 per month. He didn’t take your temperature, measured your blood pressure or asked about your symptoms. You would not feel confident that you made the right decision going to that specific doctor, and you would probably fork out another R500 for a second opinion.
With the above scenario in mind, ask yourself – why take a risk with your life, life savings and retirement with someone who doesn’t know anything about you?
Any Financial Planner worth his salt will never sell you a product, but a solution. The solution will be put together based on the information gathered from the FNA – Financial Needs Analysis.
A proper Financial Needs Analysis records a client’s goals and needs at a specific time, and provides a point of reference when the annual review of the client’s portfolio takes place. There is a skill involved in asking the right questions and understanding the client’s wishes and circumstances.
This provides the planner and the client with a point of reference to base amendments on, for example when a client gets married or has children. The FNA gives the Planner the opportunity to assist the client holistically by offering assistance on how to improve the structure of a budget or debt, provisions to be made for children’s education, the implication of a client’s will in terms of provisions like guardianship and estate duty, retirement planning, future needs and goals and of course insurance to make provision for the unforeseen.
If you have not had a FNA done, chances of you finding yourself around a boardroom table, or listening to the radio, overhearing a conversation about life insurance and retirement, and you realise you don’t know if you have enough. Perhaps you don’t even know how much you have. Or what you have. What is enough? Do you know the answer?
In his book “Start with Why”, Simon Sinek wrote: “You don’t know what you don’t know; never was there a truer sentence ever spoken. The question is, knowing we don’t know everything, what’s the best way to learn more?
The answer is ironically obvious: look outside. I’m not talking about some existential vantage point, I mean literally, look outside. Step away from your desk and do something, see something, read something or listen to something that has nothing to do with your work. Do something that has nothing to do with what you know”
Failing to plan is planning to fail, and herein is the value of a FNA and the right financial planner.
Written by Douw Steyn – Douw joined Momentum in 2018, and Momentum Irene in 2019. He holds a degree in B Com Business Management , and completed his Post Grad in Financial Planning.