Many banks and investment companies offer one financial planning session for free. One session goes quickly, however, and there are many tasks you’ll only want to tackle with a planner you expect to have an ongoing relationship with. But don’t’ turne down—or simply forget about—that free session you’re being offered! Look to tasks like rolling your 401k, starting to think about saving for college as well as beginning the process of financial goal setting as great items to discuss in a one-off session. Once you know what you’ll use your session for, here’s how to get the most from it:
• Be prepared. Tyson Farmer, a Financial Consultant at WaMu Investments, says, "When you sit down with someone, you’re going to be asked about goals. You need to have a clear picture of when you want to retire." You’ll also need to bring your financial records.
• Be honest. If you only tell the consultant about $100,000 you have to invest, when you have $300,000, he can’t give you the best advice.
• Ask questions. Find out about investment proposals or strategies the consultant suggests. If you don’t understand what is being said, say so. You’ve only got this one session, so force yourself to think of follow-up questions and get them on the table now, rather than presuming you’ll be able to get the planner to chat later by phone—when they’re not being paid!
• Don’t be steered to specific investments too quickly. Farmer seldom talks about individual investments in the first meeting. First, he finds out more about the client and their needs. He says, "It’s important to find the investment to fit the need and to explain how it fits time horizon." So if you’ve got only one session on the books, look to your overall strategy as well as broad goals you and your family will want to hit.
• Make sure you know how the consultant gets paid. Nothing is really free. Consultants receive commissions, fees, or some combination. Your first session has been comped, but it’s good to know their fee structure in case you want another appointment.
If you’re thinking your free session is really an audition for a longer term relationship, you’re right. Tracy Piercy, Certified Financial Planner Professional and CEO of MoneyMinding.com, says, "You make the investment to get to know the person who is going to be your financial advisor. Consumers have to go in knowing that they are interviewing the financial professional."
But don’t use that free session as your only interview. If you’re looking for a long term relationship, talk to two or three consultants, but not many more. You’ll be more confused than when you started.
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