The Top 3 Myths of Financial Planning

So one of the key myths of Financial Planning is that our role is to minimise your tax or reduce your tax bill. The reality is our job is certainly a lot larger than that. It’s about looking at the long term objectives, how do we position your portfolio, your investments and your savings to achieve that. Tax is simply a by-product of that. And the fact that you want to minimise your tax is the work of the accountant. Our job is to manage your tax along with your accountant so that you’ll be in the position to meet your longer term objectives with the asset base that you have.

The second myth about financial planners is that its about picking the right stocks or getting the best returns year on year. Whilst that certainly is a nice to have and we would all like to have that type of results, the reality is, its a broader picture. Again, I come back to the strategy part of our business, of our role and its about picking the right asset to fit the strategy. So that it will help you get to the destination or the plan that we’ve actually put in place. So investment returns is just one factor.

I think the final myths about working with a financial planner is that you need to have a large balance or large sum of money to work with a financial planner. It’s certainly true that these type of clients have and do engage with a financial planner but usually, its about either protecting their wealth or growing their wealth. But it doesn’t stop a client with $30,000 in superannuation from actually sitting down with an advisor, working out a plan and a strategy about how to grow their wealth. It can start with just working should we put our superannuation in a balanced fund or growth fund. It’s as simple as that.

The thing that we have to remember is that those clients with larger balances, usually started off with $30,000 balance at one point as well.