UK Resident Doctors and Dentists - Are You Planning Your Financial Future Or Being Sold Policies?

There are really only two types of services you canCashflow modelling is crucial as it gives your Financial
choose from when getting help with planning yourPlanner a context within which advice can be provided
finances, although some financial advisers do not offerbecause it highlights any areas of vulnerability. More
both.importantly, it gives you a context within which you can
The key question you should ask yourself is which onemake decisions as the effects of various scenarios
is best:can be modelled.
Financial Advice or Financial Planning?This could be termed your own financial map for the
Clients that get financial advice often end up treatingfuture. On many occasions clients are better off than
their financial programme like a shopping trip. Theythey imagined and surprised with the results, meaning
simply progress through life collecting policies. It is verythey can make more accurate financial decisions.
much an event driven exercise.As you can probably see, financial planning is much
For example, you may have children so you buy somemore proactive and holistic/comprehensive. The
life assurance or see an advert and buy an investmentproblem is that it only works properly if it is impartial.
policy etc.You need to have the confidence that all your options
Because it is event driven the advice is reactivehave been considered; writing a will for Inheritance Tax
problem solving, and will almost always result in a policyplanning versus purchasing an insurance product is a
being sold to you (or doing the research yourself andgood example of this.
you buying the policy without advice).Indeed, it may be the case that you already have
The problem with this is that there isn?t any form ofenough money to achieve your goals in life so the best
measurement that takes place until it?s too late. Youstrategy may be to spend more.
reach the checkout, i.e. retirement, and have to hopeEqually, if by measuring your worth against your
you have enough in your trolley to last you for the restobjectives it is shown to be a very rosy picture, you
of your life.could reduce the risk with your existing investments.
Or worse, something goes wrong on the way to theThis protects you from the volatility present in many
checkout ? illness, accident etc and you have toportfolios.
rummage in the trolley in the hope that you haveCommission or Fees?
something in there to deal with the problem.If your adviser only got paid if they sold you a policy,
In simple terms it is a retail service and the people thatyou may well question the impartiality. Even more
provide it get paid according to what they sellworrying is that ongoing reviews and monitoring is
(assuming they are paid by commission and not byessential to make sure your planning remains on track.
fees from you).If your adviser only gets paid when he/she sells you
Having said that, a financial advice service may besomething, can you really rely on the ongoing attention
appropriate for your needs now before you progressto your planning needs?
to a more comprehensive financial planning service.The Financial Tips Bottom Line:
Financial Planning is much simpler and more effective.So to summarise, financial planning is more proactive,
The first step is to work out what your objectives are,holistic and comprehensive, and may be a more
making sure you spend time to work out both yourappropriate proposition for your needs than financial
needs and your wants. The next step is to work outadvice. Getting impartial advice is the key, and this can
how far all your existing plans and investments will gobe achieved with a fee based financial planning
towards achieving your objectives.service. If you deal with an adviser, remember to ask
Cashflow forecasting software is then used to buildthem what financial planning services they offer.
the framework of your financial plan, marrying up yourIf they only provide a financial advice service, maybe
objectives with your current and future sources ofit's time to interview other advisers that DO offer the
income.type of service that you're looking for.