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| Fact: |
38% of Australians say they regret not having done more financial planning or seeking expert advice.*
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The definition of financial planning
Financial planning is the process of developing strategies to help you manage your financial affairs so you can build wealth, enjoy life and achieve financial security.
Some people may think that financial planners only give advice on investments. This is not true. The role of a qualified professional financial planner is to look at all aspects of your lifestyle, goals and requirements and develop a financial strategy suitable for you. The recommended strategy should help you reach your financial goals effectively and efficiently.
Advice falls into two areas: general or personal
| General advice is on financial products but does not take into account your personal circumstances. |
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Personal advice takes into consideration your personal objectives, financial situation and needs. |
The six-step financial planning process
When developing a financial plan for you, known as a Statement of Advice (SOA), a financial planner will follow a structured process to help understand your needs and recommend an appropriate strategy. The six-step financial planning process is as follows:
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Gather your financial information |
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Identify your goals |
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Identify financial issues |
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Prepare your financial plan (called a Statement of Advice) |
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Implement the recommendations based on your financial plan |
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Review and revise the plan at regular intervals, or when circumstances change. |
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*FPA research on consumer attitudes to financial planning
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