"What Exactly is Financial Planning Anyway?"

Given the fact that “financial planning” has become a catchall phrase for an abundance of different financial services, it’s a good question. Allow me to take this opportunity to describe how I view financial planning and why I believe it is so important for all of us to do.


As I see it, financial planning is the process of meeting our life goals by taking a holistic approach to managing our finances. This definition is key. First, financial planning is a process, not a product. Second, financial planning puts each financial decision into the context of your overall financial picture, so that no decision is made in a vacuum.


The financial planning process starts with identifying your goals—whether it’s to buy a home, start a business, save for your child’s education or plan for retirement. The process continues with gathering relevant financial information, examining your financial status, and developing a strategy or plan for how you can meet your goals given your current situation and future plans.


You can do your own financial planning if you prefer. Or, if you feel that a professional adviser could help you improve on how you currently are managing your finances, you may decide to seek the assistance of a financial planner. If so, the following tips may be useful.

  • Understand that anyone can claim to be a financial planner. The government does not regulate financial planners as such; instead, it regulates planners by the services they provide, such as selling securities or insurance, or providing legal advice. As a result, the term “financial planner” may be used loosely by some advisers. That’s why it’s so important to interview several financial planners before choosing one.
  • Find out if the financial planner will take you through the financial planning process. Whether you want the planner to help you with all aspects of your financial life or focus on a single issue, the planner should use the financial planning process I described above.
  • Look for professional credentials.
  • Word of Mouth

I also would be pleased to answer your questions. For a complementary initial interview, call Mike Lynch, CFP®

  at (954)423-1936.