What does my Financial Planner (FP) need from me to provide a detailed picture and forecast for my financial independence?
If you are asking this question, you’ve come to the right place. Once you have determined that the FP and the firm they represent are reputable, and you’ve determined that you can trust this person with your money, your lively hood and your personal information; you can begin the data collection.
If you share your finances with a spouse, partner or significant other, you will need to include their information to. You will need the most current information of the following:
CONTACT INFORMATION
-Include for you and your spouse. Full Name, Address, Phone and email
GENERAL FINANCIAL INFORMATION
-Children or Dependent Names and Ages
-Tax Return (last one filed)
-W-2 for all employers
ASSETS
-Pension Plan statement, for all employers (if applicable)
-401K statements (for all accounts)
-529 statements (if applicable)
-Social Security Statement (can be ordered http://www.ssa.gov/mystatement/)
-Money Market Statements
-Annuities Statements
-Interest (Savings, checking and other investment accounts)
-Dividend payments (Savings, checking, investment accounts)
-Common Stock statements (includes quantity and value)
-EE and I Bonds (quantity and face value)
-Treasury Bonds (quantity and face value)
-Checking Account Balances (include dividend and APR)
-Saving Account Balances (with APR)
-Partnership or Corporation ownership
-Residential Property (Value, Property Taxes, Principle & Interest, Annual Insurance)
-Rental Property or other property investment (Value, Property Taxes, Principle & Interest, Insurance)
-Vehicles, motor home or travel trailer (Value, personal property taxes, Principle & Interest, duration of loan and % of loan)
-Estimated value of Jewelry
-Estimated value of home furnishings (e.g. furniture, TV, stereos etc.)
-Life Insurance (policy & cash value)
-Property Insurance (policy & cash value)
-Health Insurance
-Disability Insurance (policy & cash value)
-Cancer or other Catastrophic Insurance (policy & cash value)
-Burial Insurance
-Home Health or Aging Coverage
LIABILITIES
-Monthly Expenses
-Home Expenses (Mortgage Payment, utilities, etc.)
-Vehicle Expenses
-Monthly Loan / Lease Payments (Duration of Loan or Lease, Loan %, Insurance)
-Other Monthly Expenses
-Health Insurance Premiums
-Charitable Contributions
-Entertainment (Movies, Travel, Concerts, etc.)
-Monthly Savings Plan (How much are you currently saving, include interest rate)
-Student Loan(s) (Payoff, Loan %, Duration of Loan)
-Credit Card (include ALL) (Current Balance, Minimum Monthly Payment, Current Monthly Payment, Credit Card %)
-Loans (include ALL) (Current Balance, Monthly Payment, Loan % and duration)
-Medical Expenses (elected and necessary-include any expenses not covered by Insurance)
-Legal Obligations (Child Support, Alimony, Law Suits)
-Any other investments not listed above
-Any other liabilities not listed above
OTHER INFORMATION TO PROVIDE:
-Your retirement plans (include the age you wish to retire)
-The level of risk you are comfortable with (some are more risky investors, others prefer safer, less risky investments)
-Be sure to convey your needs, desires and wants regarding retirement, savings and financial independence.
If you don’t already have a detailed list of your assets and liabilities, this exercise might be shocking, scary or even exhilarating. Either way, be honest to yourself and to your FP. Without a complete picture of what you owe and what you have, he can’t provide you the specific details and the proper projections for a healthy financial future.
If you currently have credit card or other liabilities, don’t worry, even in the meekest of situations, there is hope and opportunity to save. Financial Planning is not done overnight, it is a lifelong attitude adjustment and requires life style changes. Good financial planning should include mitigation for the ups and downs associated with the economy and the market.
Debt is the worst poverty. ~Thomas Fuller
Remember that credit is money. ~Benjamin Franklin
Three Cheers to Financial Independence.