Tag: Medical Aid

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HOW TO CHOOSE YOUR FINANCIAL ADVISOR

Momentum Irene

If you take a look at businesses today, it is all about budgets and targets, and achieving them by any means possible. To be honest, it is no different in the financial industry. It is a numbers game. The more cases you close, the more money you will make. Similar to any retail shop, really. The more people through your door, the more bread you can sell, the higher your profit.

There is a significant difference though – Financial Planners have their clients’ livelihoods in their hands.

How many financial advisors have you dealt with in your life? How many didn’t answer and/or return your calls? Just ignored your email when you were in need of assistance, needed to make a change, or take a payment holiday?

The Salesman

A salesman is only in it for the money, and you can spot them easily. They go door-to-door selling you a hoover or a policy. They are not concerned with what you need or how much you can afford. They are only trying to reach their quota. They do not offer solutions and do not educate.

If your Financial Planner’s goal is chasing money and wealth, there are some tell-tale signs from the start.

  1. Are they asking you about YOUR needs? (They really should)
  2. Are they telling you what you need, without taking your financial situation and financial goals into consideration? (They really shouldn’t)
  3. Are they trying to sell you the maximum number of products, at the highest price?

The above approach is often used when giving financial advice to clients – making all high earning products and services most appealing to close the deal. A Salesman will generally look at an upfront commission instead of a monthly commission. (Note, this is not ALWAYS the case – discuss your options with your financial advisor). Their focus moves away from the clients’ needs and is rather focused on the sale opportunity – don’t get fooled by the smooth-talking Salesman.   

The Financial Advisor

Any Financial Advisor worth his/her salt, is there to help their client with proper financial plans and strategies by giving financial advice. A first session with your advisor should start with a Financial Needs Analysis (find out what is a Financial Needs Analysis)

Based on the results of the FNA, the advisor should advise on smart financial strategies, investment planning, cash management, education, last will and testament and other areas to help the clients reach their financial objectives and goals.

By law, a financial advisor should review a client’s financial plan at least once per year.

The relationship between client and advisor must be built on trust. To achieve that, they must listen to you, care about you future and give the right advice, for the appropriate time in your life and financial situation. This will build a long and trusting relationship with one advisor where you grow together, and you are not purely a number on your Advisor’s monthly quota.

Let us take you for a coffee, and tell you more.

Article written by Johan Vermaak. Johan joined Momentum Irene in 2019 as a Financial Advisor.
Financial Planning Jargon

Why a Financial Needs Analysis (FNA)?

Momentum Irene

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.

Medical Aid

ARE YOU PREPARED?

Momentum Irene

You had this perfect plan. Or we had. Fall in love, get married and then, when you are ready, start a family! But life likes to throw some lemons our way every now and again, and things just doesn’t work the way we would like it to. (Maybe because we don’t have a spare bottle of tequila hidden in a cupboard somewhere)

My wife recently had to go for an operation, as we are struggling to start that family (although we are very happily trying to!) We have been to a variety of doctors, who prescribed different blood tests, different medications, taking temperatures and what not. All of which has not been successful.

We finally made it to this one lady doctor, who suggested we take a deeper look. What we found is not what is important, but what is, is that the consultation with this doctor (ONLY the consultation, that lasted about 20 minutes) was R2 000. That is a very real number, especially if you compare it to medical aid rates, and that it fell way outside of what the Medical Aid was prepared to pay for. It was a cash account.

We then had to get pre-approval for the procedure, and that had a R3 000 co-payment. Also cash.

This is us, R5 000 out of pocket, before we even know if something is wrong, never mind what is wrong.

Luckily for us, thanks to an active lifestyle and a positive health saver balance, we could pay for the consultation with the Multiply Visa Card, as it works like a normal Visa Card. We also have additional Gap cover added to our Medical Aid Plan that covered the shortfall in hospital.

Were we prepared? Probably not mentally or physically, but at least we could afford it without breaking our own little piggy open.