Reviews are the key to financial planning

Wednesday, 7th July 2010 17:55 - by Resident IFA

I am visiting existing Clients at 7.30 tonight. They invested money 16 months ago; having risen by 31.8% in the interim (based on values I obtained on Monday). Wow! How good is that?! Well...yes...after a fashion. Forgive my reservation but, although this is an attractive return (at present), I believe I add even more value to my Clients by the very fact that I am seeing them this evening. It is no good an Adviser arranging an Investment or Pension for a Client – however good the underlying investment funds/vehicles may be – if it and the Clients circumstances are not regularly reviewed. Tonight, I will be mostly asking: o Do they wish to release some of the profit now available? o Would they prefer to move it to lower-risk investment areas to ‘protect’ the gains? o Have their circumstances changed? o Them to complete an Attitude to Risk questionnaire to see if their previous ‘Medium-High’ position has moved to any degree. o Do they have additional funds to commit to investment? o Have they considered their Inheritance Tax (IHT) situation? o Etc. The above questions are those basic ones that will help them keep perspective on their financial planning. I already recommended ‘Portfolio Re-Balancing’ on Day 1, so their investments will have a similar asset allocation to then i.e. 30% UK Equities, 10% Property, 10% Gilts, and so on; not now being completely dissimilar and of a different risk complexion from that which was recommended and agreed. As always, I try to stimulate food for (financial) thought and hope that this encourages readers to keep on top of their long-term financial planning and ensure their Adviser is providing a good and suitable service. Until next time...