Creating a comprehensive plan

Designing a comprehensive financial plan involves the following six steps

1. Establish the advisor - client relationship. You / Advisor Define roles and responsibilities, and determine how decisions will be made.
2. Gather information, and define goals. You / Advisor Compile account statements and other documents; discuss retirement, children's education (if applicable), and other goals; determine risk tolerance (investor profile); explore general values and priorities in the areas of work, family, and personal fulfillment.
3. Analyze and evaluate your financial status - and identify risks, challenges and opportunities. Advisor Determine what you need to do to reach your goals. Consider all areas: investing, debt management, business planning, tax planning, retirement planning, insurance planning, business succession planning, and estate planning. Decide which outside advisors, if any (accountant, lawyer, other) are required to complete the plan. Prepare a written list of recommendations.
4. Present recommendations to you. You / Advisor Review recommendations. Explain the rationale for each, obtain your input, and adjust recommendations as necessary. Answer questions. Describe next steps.
5. Implement recommendations. You / Advisor Depends on recommendations. Examples of activities may include reallocation of investment portfolio, establish a retirement plan for you - and/or a succession plan for your business.
6. Monitor plan. You / Advisor Periodically revisit goals and evaluate progress. Define new goals as appropriate and tweak plan to incorporate them. Ensure other advisors (accountant, lawyer, etc.) are working in harmony.