The financial planning process

In talking to some colleagues and clients I have been told that one of the complaints people they know have is that financial planners only talk about insurance and shares. These products make about PART of the tool kit that provides for both wealth protection and wealth accumulation.

Why do I provide risk management advice as part of my advice process? Because I have seen situations where a good wealth accumulation strategy has been working well only to be torpedoed by something happening to the client, ceasing their income and causing wealth accumulation strategy to fall in a heap as they no longer and feed the investments to help them grow.

Why do we cover all types of investments in our advice? There are two main ways to accumulate wealth sustainably. They are, investing in shares and investing in property whether directly or through some sort of managed fund or property trust. The aim being to build an investment portfolio that can at some stage replace your personal exertion income with income from the investments. Many don't have a portfolio of sufficient size to produce sufficient income, therefore they have to sell down their investments to help fund the shortfall. If you just have a direct property portfolio it means that you have to sell a whole property, often trigerring significant capital gains tax in one hit. With the flexibility of other investment options including property via property trusts you can sell down part at a time only freeing up the amount of money you need not a lot more than you need.

That is why when we structure portfolios we look at how we can achieve the wealth accumulation goals but provide enough felxibility for different stages of life as well.

Seeking advice from a suitable professional adviser will enable you to make informed and educated decisions about your financial future.

Regards


Damian Ebzery B,Bus M.Bus AFPA ASA

Beware of Junk Insurance Policies

Beware their are a new range of junk insurance policies being sold. Income Protection / Disability policies that only cover you for 1 year on claim, non renewable after 5 years in place (drop out generally when you need them most, are older and may hae some health issues affecting your ability to get a new policy) and have a very limited definition of disablement. The premiums are only slightly less than a quality policy to pays you to age 65, is guaranteed renewable (as long as you pay the premiums the policies will be in place till age 65) and have much better definitions of disablement and can also pay a partial claim as top up income.

The devil is in the detail.

Don't pay good money for half baked protection.

Regards


Damian Ebzery B.Bus M.Bus AFPA ASA