Develop Financial Plans from templates

The core elements of a Financial Plan (e.g. introductory narrative; statement of capital assets and liabilities; details of current and future cash flows; tax calculations; chapters on risk management, investment (including pension provision) and estate planning plus details of objectives, planning assumptions and clients’ data) are common to most Financial Plans and can be incorporated in templates provided they are comprehensively edited to meet the specific needs of individual clients. Templates avoid the need to start each Plan with a blank sheet of paper, thereby saving a great deal of time, an important point if clients are being charged for the time taken to prepare a comprehensive Financial Plan.

Some Planners manage very well with just three basic templates – one for a married couple, one for an unmarried couple, and one for single clients.  Too many templates can create maintenance problems.

Develop Financial Plans with clients rather than for clients

If clients are closely involved in developing their Financial Plans (using a logical process of defining objectives, deciding planning assumptions, drawing conclusions, developing an action plan and checking affordability) implementation follows naturally and quickly.  Involvement with the ‘building bricks’ of a Plan enhances understanding of the planning process and helps clients reach decisions quicker than wading through a ‘report’. However, it’s important that Planners develop good keyboard skills and become fluent in using their computers and software in front of clients. Confidence grows with practice.

Arrange to have a large screen or a white wall in your meeting room so that what is on the Planner’s computer can be projected and clients can participate more easily in the financial planning process. Allow sufficient time for a full planning meeting (3-4 hours), ideally starting no later than 9am. This will make it easier to produce and despatch the minutes of the meeting that afternoon, often with the completed Financial Plan, especially following ‘review’ meetings with established clients.

Avoid developing more scenarios than absolutely necessary

Lots of ‘what if’ scenarios are time consuming and are rarely necessary if fact finding is done properly and a clear understanding of objectives and constraints is achieved before starting to develop a Financial Plan. ‘Digging deeper’ questioning is a skill inadequately developed by many Planners.  It’s important to understand not only what a client is seeking to achieve but why.  Too many scenarios may confuse clients.

Finish Financial Plans while everything is easy to recall and despatch to clients as soon as possible

Many key decisions can be reached during a planning meeting with clients, especially if the meeting is held in the Planner’s offices so that illustrations and key features documents can be obtained as required. However, there is almost always additional work to be done after the meeting, especially in relation to preparation of written recommendations and ‘reasons why‘. This work can be done quickest immediately after clients have departed and it’s desirable that the Financial Plan is completed and despatched to clients before key elements of what was discussed at the planning meeting are forgotten.

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Other Planning Tips in this series cover ‘How to be more profitable’ and ‘How to move to ’fee based’’.

If there are topics you would like covered in future ‘Planning Tips’ please email your requests to spe@prestwood.info
Requests for future Planning Tips should be emailed to the same address.

Paul Etheridge, MBE, TD, MBA, FIFP, FCII, CFP (Certified Financial Planner  & Chartered Insurance Practitioner)

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