Financial Planning: Frequently Asked Questions About Financial Planning
Must I do financial planning?
No. And in fact many people who don't do financial planning end up just fine. What financial planning can do, however, is tell you the steps you need to take in order to retire comfortably, send kids to college, and avoid certain predictable financial disasters.
How do I find a good financial planning professional?
Good question. Unfortunately, you'll find it very difficult to find someone good. Many of the people who call themselves financial planners are really commissioned sales people. Sometimes these sales people give good financial planning advice. Often they do not.
My suggestion is that you ask other savvy professionals for referrals. For example, if you ask your CPA or your attorney, he or she may be able to give you the name of someone good.
Will financial planning improve my personal finances?
Yes. But only if you do good planning and then use the plan to save appropriately for your future financial objectives and use the plan to avoid predictable financial disasters.
How long should the financial planning document be?
Some of the financial services firms like to write financial plans that are fairly long and include lots of fancy charts and tables. That's fine, I guess. But what you really need are short, to-the-point recipes for accomplishing your financial objectives.
Can you do your own financial planning?
Yes, you can. You just need to educate yourself about investment options and insurance products. If you want to go this route, I'd recommend (predictably) any of my books, anything that Andrew Tobias has written, Burton Malkiel's books on investments, and anything that John Bogle (founder of Vanguard) has written.
Where can I get more information about financial planning?