What questions to ask to tailor the best investments for you.
Tailor-made investment portfolios should be at the heart of first-class wealth management. We all have different aspirations in life, and it is critical that your financial adviser gets to know your personal financial situation and the way you think about money.
For many of us, financial success is having sufficient funds to provide for their loved ones’ futures. However, making assumptions leads to disappointment. Instead, a good financial adviser asks the right questions.
You should feel assured that your financial adviser is serious about your financial wellbeing and understands your financial goals.
- Do they understand you as an individual? What your values are and your hopes for your family’s long-term security?
- Have they gleaned critical information about your habits, likes and dislikes?
- Have they asked about your approach to risk?
Only armed with this level of insight into you as an individual can a unique investment solution be perfectly structured to suit your personal financial needs and goals.
SO, WHAT QUESTIONS SHOULD YOU EXPECT TO ANSWER?
If you pass away tomorrow, what happens to your family?
- Who are the beneficiaries that you have nominated on your retirement funds and your life and group life policies, as well as other investments in your portfolio?
- Is there a fair division of your estate without favouring one child or family member?
- Have you taken into consideration previous financial gifts or loans?
- Have you made provision for the younger children in your family or extended family? Is it necessary?
- Is there enough liquidity in your estate to ensure that bequests, estate duties and fees are paid, or will they need to sell any assets?
- Will you be able to care for your family financially after you have gone?
- Will your family be able to sustain the standard of living to which they’ve become accustomed, or will they need to adjust their lifestyles?
- Have you made provision for your children’s or grandchildren’s current education and further education?
- Does your family have or need private medical insurance, and do any members of your family have specific medical needs that you would like to take care of?
These questions are key to ensuring your family’s financial wellbeing. Through your replies, your financial adviser will gain a thorough understanding of your family’s needs and consequently tailor-make your financial plan.
HOW MUCH IS ENOUGH
A common question is how much do I need to secure my retirement or succession aspirations? Or, can I ever have enough funds to ensure a happy retirement, or to ensure enough income in years to come?
Time is a critical factor in any retirement plan, and with people living longer and with more productive lives this is both a challenge and an opportunity. A trusted financial adviser can help you calculate this figure but, importantly, it should be reviewed often to ensure that as your lifestyle, health and aspirations change, your available funds are aligned, and investment strategies adjusted.
When conducting a lifestyle sustainability assessment, we look at the following, alongside the cost of inflation:
- Your assets and liabilities as well as your expense and income.
- Expenses such as private healthcare costs, home maintenance or the cost of retirement and end-of-life care.
- Your regular monthly household expenses, for instance on groceries, entertainment, hobbies and wages.
- Expenses such as your children’s or grandchildren’s education at various levels, from early years to higher or university education.
Then we look beyond the day to day, and make specific provision for lifestyle and other larger expenses:
- Purchases of vehicles for yourself and your children.
- Maintenance of second homes.
- Dream holidays.
- Significant occasions such as weddings or special anniversaries.
We can base our calculations on careful observation of your spending patterns. This is an ongoing process, expenses will be adjusted downward or increased in line with your lifestyle and specific situation and may also be discontinued at a future date, based on your lifestyle.
The next step is to take the combination of assets and liabilities, income and expenses to create a financial profile in the form of a graph.
We plot your age and your accumulated capital and the effect of the investment growth and income withdrawal on the capital amount.
This graph shows us many things, but primarily it is the basis for determinising the sustainability of your lifestyle and the value of your estate in real terms. Effective estate planning is central to the analysis and is an ongoing process which also helps to give you financial independence and peace of mind.
HOW DO YOU THINK ABOUT MONEY
This is a very revealing question, and one that a good financial adviser will always ask. It reveals a lot about a person and, of course, the answer differs vastly from person to person. How a person answers is linked to their gender, age, culture and personal circumstances and may change throughout their life.
For some money may be a means to an end or buy a given lifestyle, or for others it may be accumulated to provide for their children’s future. For some it is the quantifiable proof of success, to others money is the means to enjoy the here and now, and a way to support their interests and hobbies.
A financial adviser’s role is to guide you. Therefore, we design and align your financial roadmap to reflect your financial and personal goals. We partner with you on your financial journey.
We deliver a highly personalised service to our clients and prospective clients which is built on a deep understanding of your individual investment goals and needs.
- Personal and familial financial situation
- Personal risk planning and personal risk assessment
- Asset allocation
- Fund management
- Stock selection
- Estate planning
- Legacy ambitions
We consider all these factors and provide you with a fully optimised and unique financial solution.